• Texas is preparing rules requiring large-load customers to provide financial security before entering ERCOT studies
  • Batch Zero will assess proposed loads of at least 75MW together and allocate available transmission capacity

The fact

The Public Utility Commission of Texas is preparing new rules for large electricity users after Governor Greg Abbott called for data centres to pay more of the grid costs linked to their connections. Under the proposal, large-load customers would have to provide financial security before entering ERCOT planning studies, pay their direct interconnection costs, and begin paying transmission charges once capacity becomes available. These payments could start before a facility begins operating. PUCT expects to complete the rulemaking by December.

ERCOT has also launched Batch Zero, a process that will review proposed loads of 75MW or more together. The study will identify available capacity by location and year through 2032, then allocate it among qualifying projects. Texas has separately tightened load forecasting and rules governing the use of existing generation for new data centres.

The assessment

Under the proposed rule, developers could face grid-related costs much earlier in the project. They may have to provide financial security before the ERCOT study begins. Transmission charges could then start once capacity is available, even before the facility opens.

That would force developers to settle the size and timing of their power request earlier. It may remove some tentative projects from the queue, but it would not prove that the remaining projects are fully funded or certain to proceed. Much will depend on the size of the security requirement— whether it can be recovered and how the rules treat projects that are delayed, reduced or cancelled.

Batch Zero creates another constraint. ERCOT will review several large projects seeking power from the same part of the grid, so a project may be technically viable but still fail to secure enough capacity at its preferred location. For BTW readers, this means grid access could shape financing and construction plans much earlier. Developers will need to match the power they request with both their project timetable and the capacity ERCOT can actually provide.

What to watch

Watch for the final PUCT rule, expected by December. Important details will include the amount of financial security required, when transmission charges start and how the rule applies to projects that are delayed, reduced or cancelled. Batch Zero should also show where capacity is available through 2032 and how ERCOT plans to allocate it among qualifying projects.