Federal energy regulators are nearing a June ruling on how large AI-driven data centers connect to the electric grid, a decision that could affect household power bills, transmission planning and the speed of new data center construction.
By yourNEWS Media Newsroom
Federal energy regulators are expected to decide by the end of June how the nation’s power system should handle the rapid growth of artificial intelligence data centers, a ruling that could determine whether existing electricity customers or major technology firms absorb the cost of new grid infrastructure.
The Federal Energy Regulatory Commission has pledged to take action this month in a rulemaking focused on connecting large new power users to a transmission network designed for a more gradual and predictable pattern of demand growth.
The proceeding has broad implications for electric bills, utility planning and the pace of AI expansion. The central question is whether the costs tied to massive new data center loads should be folded into the traditional power grid or assigned more directly to the companies creating that demand. The stakes range from household energy costs to the future speed of artificial intelligence development.
The case, listed as Docket No. RM26-4-000, began after an Advance Notice of Proposed Rulemaking was issued in October 2025 by the U.S. Secretary of Energy. That notice directed FERC to consider reforms that would allow the “timely, orderly, and equitable integration” of large new loads.
Since then, commission staff has reviewed more than 3,500 pages of public comments as regulators weigh how to manage the surge in electricity demand. Chairman Laura V. Swett said FERC is “addressing this challenge head-on” as data centers alter the country’s transmission needs.
Much of the pressure is concentrated in PJM Interconnection, the nation’s largest grid operator. PJM serves more than 65 million people across 13 states and the District of Columbia, including major data center markets in Virginia, Ohio and Pennsylvania.
PJM’s independent market monitor found that existing and projected data centers accounted for about 40% of the $16.4 billion in costs from the grid operator’s most recent capacity auction.
Regulators are now weighing two competing approaches. One option would connect hyperscale data centers through the regular grid, leaving utilities, regulators and ratepayers to manage the cost of additional transmission lines and power generation. The other would allow data centers to connect directly to power plants or develop their own on-site generation, keeping those loads outside the broader grid at least in the early stages.
FERC has already taken steps that point toward a broader framework for handling the new demand. In December 2025, the commission ordered PJM to create transparent rules for large loads that are co-located with power generation. In January, FERC approved the Southwest Power Pool’s High Impact Large Load initiative, which creates a process for accelerating major customer interconnections along with the generation needed to serve them.
Those moves indicate that regulators are seeking to guide the data center buildout rather than stop it. The June order is expected to address how costs and risks should be allocated as grid operators confront a level of demand growth tied largely to artificial intelligence.
For customers in PJM’s territory, the outcome could affect future power bills. If data center costs are absorbed through the broader grid, existing customers could see higher charges as utilities and grid operators expand infrastructure. If the companies driving the new demand are required to bear more direct responsibility, hyperscale developers may face higher upfront costs and additional requirements before connecting.
PJM’s 2026 long-term forecast projects summer peak demand will rise from 160 gigawatts in 2025 to 253 gigawatts by 2046, a 58% increase. The grid operator attributes the projected growth primarily to data centers.
The expected order could also influence how other regulators treat large-load customers in their own regions. As of June 13, 2026, FERC had not issued its final decision, but the ruling expected later this month is likely to become a model for how the power sector responds to the AI-driven electricity buildout.
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