NERC Asks FERC to Fast-Track Data Center Registration Rules

On October 21, 2026, the North American Electric Reliability Corporation (NERC) petitioned the Federal Energy Regulatory Commission (FERC) (Petition) to expeditiously approve proposed changes to the NERC Rules of Procedure that would add two new types of registered entities: the Computational Load Owner (CLO) and the Computational Load Operator (CLOP). If FERC grants the Petition and approves related reliability standards that NERC will file later in the year, owners and operators of large data centers and similar facilities connected to the bulk power system (BPS)[1] (i.e., CLOs and CLOPs) will need to be listed on the NERC Compliance Registry and will need to comply with mandatory reliability standards and related penalties for violations.

Background

NERC's Large Loads Action Plan has focused on large loads and their reliability risks since 2024, including the issuance of a Level 2 alert in September 2025, along with white papers from its Large Loads Working Group. NERC followed that Level 2 alert by issuing the rare Level 3 alert on May 4, 2026, which we covered in May. Separately, FERC ordered NERC, on July 16, 2026, to file registry criteria and an initial set of reliability standards for CLOs and CLOPs with a filing deadline of December 31, 2026.

NERC initially proposed to define "computational load" as load comprised of power demand from information technology equipment, such as servers, storage, and networking hardware. NERC's proposed revisions within its Petition no longer define computational load. The Petition includes a document responding to stakeholder comments on the definition, determining that "with the use of the newly proposed Computational Load Site definition, the definition of Computational Load is no longer needed for registry criteria purposes."[2]

In the Petition, NERC identified several grid disturbances involving large loads to underscore its need to act expeditiously:

1. A 230 kV transmission line fault in the Eastern Interconnection caused about 1,500 MW of data center-type load to disconnect simultaneously (Jan. 2025).
2. Cryptocurrency mining facilities located within the footprint of the Electric Reliability Council of Texas (ERCOT), the organization that operates the Texas electric grid, have repeatedly tripped offline during normally cleared electrical faults (Jan. 2026).
3. A recent incident in July 2026, which is still under investigation, resulted in nearly 3,900 MW of data center-type load in PJM disconnecting from the grid, causing system voltage to spike.

NERC's Proposal

NERC's registration criteria proposal is built around a new defined term: "Computational Load Site" (CLS), which is defined as one or more buildings, structures, or installations at a single location that (1) primarily contain information technology infrastructure used for software applications and services, artificial intelligence training and deployment, cryptocurrency mining, or other data center computing; and (2) are supplied through electrical equipment connected to the BPS.

• Owner and operator. A CLO is the entity that "owns and maintains" a Computational Load Site. A CLOP is the entity that operates one. NERC's proposed CLO definition refers to "maintains" so that the term does not capture passive owners with only a small financial interest in a site.
• Thresholds. Registration would apply to sites with total connected load of 50 MW or more, supplied through equipment connected at 100 kV or more, from one or more points of connection. NERC estimates the final thresholds would still capture about 68,288 MW, or roughly 86% of the computational load projected by the end of 2027.
• How the voltage test works. To assess whether the voltage threshold criterion has been met, the Petition proposes that the appropriate assessment point be at the high side of the transformer that supplies the site, which may not be the point of interconnection under the related interconnection agreement.
• "Single location" and "primarily." Regional Entities will decide site boundaries and may consider ownership, shared infrastructure such as cooling load, and whether the IT equipment is used together. NERC declined to set a numerical usage percentage test to guide the application of the "primarily" criterion, but NERC stated it does not intend to register manufacturing or generating facilities that happen to have some computing equipment on site.

Why NERC Wants Expedited Action

NERC maintains that an expeditious approval of the registration criteria will provide NERC and the industry with regulatory certainty and will facilitate early outreach and registration before any reliability standard takes effect. NERC and the Regional Entities are also preparing a Registration Reference document for CLOs and CLOPs, in response to many commenters who inquired about how the rules would apply to particular configurations.

Implications

• Data center developers, owners, and operators should assess now whether any existing or planned sites meet the CLS criteria, including the 50 MW/100 kV tests. That assessment should cover how site boundaries would be drawn and how the voltage of the supplying equipment would be measured.
• Ownership and operating structures are key. Lease, colocation, joint-venture, and operations-and-maintenance arrangements will affect which entity is the CLO or the CLOP and, hence, parties may need to share and delegate compliance responsibility. Parties should become familiar with NERC's mechanisms for sharing responsibility, including Joint Registration Organization and Coordinated Functional Registration arrangements. Parties may also allocate compliance responsibilities by contract.
• Transactions and project agreements in negotiation may need to reference NERC registration, compliance costs, and possible penalties.

Interventions and comments on the Petition are due by 5 p.m. Eastern time on November 20, 2026. DWT will continue to follow the proceeding and NERC's development of the related reliability standards.

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Samin Peirovi is an associate and Nicholas Giannasca is a partner in DWT's Washington, D.C., office. For any questions or more information, please reach out to the authors or another member of our energy team. To stay informed, sign up for our alerts.

[1] The BPS is defined as the facilities and control systems needed to operate an interconnected transmission network, plus the generation needed to keep that transmission system reliable. This can be distinguished from NERC's definition of the Bulk Electric System, or BES, which is defined as all transmission elements operated at 100 kV or higher, and real and reactive power resources connected at 100 kV or higher, excluding facilities used for local distribution.

[2] NERC, "Consideration of Comments," at p. 2 (Aug. 19, 2026).