Verified

  • On October 9, 2026, the Federal Energy Regulatory Commission (FERC) accepted part of PJM Interconnection, L.L.C.'s large-load filing and rejected the rest (Docket No. ER26-3515-000, 197 FERC ¶ 61,019). FERC accepted a definition of Large Load and a Large Load Registry, effective October 12, 2026, and required a compliance filing within 30 days. It rejected the Interim Resource Adequacy Service (IRAS), the "Bring Your Own New Capacity" (BYONC) rules, and the plan to exclude eligible new large loads from the capacity demand curve from Delivery Year 2029/2030. Source: FERC order, ER26-3515-000, posted by PJM.
  • Under IRAS, a new large load whose load-serving entity did not designate new capacity at least equal to its peak would be "subject to load reduction requests" when resources fall short in real time. Source: same.
  • FERC's core objection was jurisdiction. The order says PJM's construct "appears to regulate the terms and conditions of a retail customer's service in ways that are beyond the Commission's authority," because the large loads are, for the most part, retail customers. FERC also wrote: "While we recognize the imminent capacity shortfall in PJM," IRAS and BYONC were either outside its authority or not shown to be just and reasonable. Source: same.
  • FERC, as quoted by Utility Dive: "States have a crucial role to play in this challenge by designating which retail customers must be curtailed when the system is stressed, and we strongly encourage states to continue their important work on this issue." Jefferies analysts told clients the ruling could mean higher capacity prices for longer in PJM. A PJM spokesperson said the grid operator is reviewing the order while "recognizing the responsibilities FERC indicated belong to the states." Source: Utility Dive.
  • The accepted definition: end-use load with a cumulative peak of 50 MW or more at a single electrical site, with affiliated facilities within a one-mile radius counted as one site. PJM said the radius stops a developer from avoiding the definition by clustering smaller data centers below 50 MW. Source: same.
  • The registry will hold, per large load, its location, in-service date for each increment, peak load and ramp schedule, backup generation including fuel type and permitting limits, and contracts with its load-serving entity. PJM said the data will be available to state commissions, subject to confidentiality, and that it will post aggregated data publicly. Source: same.
  • Commissioner David Rosner concurred. He wrote that IRAS would curtail data centers "in the earliest stages of emergency conditions" before demand response, and noted PJM cleared 7,017 MW of demand response in its most recent capacity auction. He also wrote that "data centers not serving critical functions should be shut off before ordinary customers," and: "We need state regulators to establish clear rules for which customers should be curtailed first." Source: Commissioner Rosner's concurrence, FERC.
  • Latitude Media reports that FERC suggested PJM explore a voluntary non-firm transmission service for flexible large loads. Mary Yang, a former PJM regulatory counsel now at 804 Advisory, said the uncertainty "is going to keep dragging," and that some developers are saying "let's go to a different region that's got more certainty." Source: Latitude Media.
  • On October 13, 2026, PJM filed a study agreement at FERC to assess SoftBank Group Corp.'s roughly 10 GW "Flagship" AI data center complex in Ohio under PJM's state agreement approach (SAA), at Ohio's request. An AEP Ohio data center tariff covers an initial 800 MW phase. The study covers another 9.6 GW of load and 10.2 GW of new gas-fired generation to be built by SB Energy, a SoftBank company, in phases through 2032. AEP Ohio, a subsidiary of American Electric Power Company, Inc. (NASDAQ: AEP), plans three 765-kV transmission lines. Most of the project would sit at the U.S. Department of Energy's former Portsmouth Gaseous Diffusion Plant in Pike County. Source: Utility Dive.
  • Under the SAA framework, projects are normally paid for by consumers in the requesting state. SB Energy says it will pay for the generation and transmission serving the campus, with payment obligations that apply regardless of how much electricity the complex uses. PJM said its studies "will not themselves select transmission projects or designated entities, establish cost allocations, or grant the Flagship Project transmission service or interconnection rights." Source: same.
  • PJM set a record peak hourly load of 162.6 GW on July 2, 2026, 1.3% above its 2025 peak of 160.6 GW, per the U.S. Energy Information Administration (EIA). ERCOT and the Southwest Power Pool also set records. EIA attributes most of these peaks to regional heat waves during the hottest summer on record nationally. Source: EIA Today in Energy, October 15, 2026.

Beneath the label

The coverage framed the FERC order as a setback for data centers. That is one reading. The more durable one is about who holds the pen.

PJM tried to solve its capacity shortfall with a regional tariff that told some retail customers when they would be cut off. FERC said a regional tariff cannot do that, because the terms of retail service belong to states. It did not say large loads should never be curtailed first. Rosner said the opposite, and put the job on state regulators.

Two other things happened in the same week, and both point the same way.

First, the one piece FERC kept is a data pipe to the states. The registry gives state commissions site-by-site detail on every load of 50 MW or more: ramp schedules, backup generation, and supply contracts. That is the information a state needs to write its own curtailment order or retail tariff.

Second, the largest single load request in PJM is not going through a PJM-wide rule. It is going through a state-sponsored study. Ohio asked for it. The developer says it will pay. PJM studies the grid impact and explicitly leaves the decisions on cost and interconnection to the Public Utilities Commission of Ohio and FERC.

The read

The verified facts, restated. FERC rejected PJM's region-wide curtailment construct on jurisdictional grounds, kept the 50 MW registry, and told PJM where a refiling would need to change. A FERC commissioner said curtailment priority is a state call. Ohio, in the same week, moved a 9.6 GW load request through a state-specific path, with the developer offering to carry the cost.

The read: the operating rules for data centers in PJM are moving from one regional market design to the 13 states and the District of Columbia that PJM serves in whole or in part (PJM). PJM still runs the grid and the capacity market. But the questions that decide whether a campus can connect, who pays for it, and who gets cut first in an emergency are landing with state commissions.

To put the Ohio request in scale: 9.6 GW is about 5.9% of PJM's record 162.6 GW peak. That is our arithmetic, and it compares a future load to one hour of 2026 demand, so it shows size, not timing.

What this would mean if it holds:

First, site selection inside PJM becomes a state comparison. A developer will weigh Ohio's state-agreement path against Virginia's or Pennsylvania's retail rules. Reading: that is the "go to a different region" behavior Yang described, applied between states inside one grid.

Second, "bring your own generation" becomes the default entry ticket for the largest campuses. SB Energy's commitment to build gas generation and pay for delivery regardless of use is the structure that sidesteps the cost fight FERC could not settle. Hypothesis: the next gigawatt-scale requests in PJM arrive with similar self-supply and payment pledges attached.

Third, capacity prices stay under pressure. FERC rejected the mechanism that would have taken unbacked large loads out of the capacity demand curve. Rosner's concern was that removing them would signal surplus while the region sheds load. Keeping them in means the shortfall FERC called "imminent" shows up in price, which is the outcome Jefferies flagged for existing generators.

Watch

  1. PJM's compliance filing, due within 30 days of October 9, 2026. It covers the definition and registry only. The real signal is whether PJM refiles IRAS, and whether a new version uses the voluntary non-firm service FERC suggested.
  2. The first aggregated registry data PJM posts. A public count of megawatts of large load by zone and in-service year would be the first consistent pipeline number for PJM data centers.
  3. FERC action on the Flagship study agreement. PJM asked for an effective date of September 25, 2026. Acceptance, and the PUCO cost-allocation proceeding that follows, sets the template for state-sponsored campuses.
  4. State curtailment orders. Any PJM state that adopts rules for which customers are curtailed first, in line with Rosner's concurrence, confirms the shift.
  5. Developer statements that cite PJM rules when choosing a site elsewhere. That is the cost of the delay, measured in projects.

If two or more PJM states adopt their own large-load curtailment or tariff rules within 12 months, the rulebook has moved. If PJM refiles a region-wide service that FERC accepts, the shift was a detour.

Sources