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FERC launches Section 206 proceeding to clarify co‑location rules for data centers and generators
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Summary
The Federal Energy Regulatory Commission on Wednesday opened a Section 206 Federal Power Act proceeding (Item E1) to consolidate prior records and develop guidance for co‑location of generation with large loads such as data centers; the commission set a 30‑day comment period and a 30‑day reply period and required PJM to respond promptly.
The Federal Energy Regulatory Commission on Wednesday launched a Section 206 proceeding to clarify how ‘‘co‑location’’ of generation with large loads — including clusters of AI‑driven data centers — should be treated under regional transmission rules.
Chairman Christie introduced Item E1, saying the order consolidates the record from a technical conference and an existing Constellation Section 206 docket and directs the commission to move quickly so billions of dollars of investment and reliability issues can be addressed. "We want to get in front of this issue," the chairman said, announcing a 30‑day initial comment period followed by a 30‑day reply comment period and inviting additional filings from stakeholders.
Commissioner Rosner, speaking in support, emphasized the urgency and scale of the change in demand patterns: "PJM alone is expecting 30 gigawatts of peak load to be added to the system over just the next five years," she said, and urged the commission to require a quick response from PJM. Rosner said the order will require PJM to respond within one month.
Commissioner Phillips framed E1 alongside Item E8 and said the orders together address gaps in PJM's tariff that the unanimous commission determined must be taken up to accommodate co‑location arrangements. Phillips also noted personnel changes in FERC's general counsel office and thanked outgoing general counsel Matt Christiansen for his work on the order.
FERC described the purpose of the proceeding as ensuring transparent "rules of the road" when a generator seeks to co‑locate with a large load customer so that reliability and fair cost allocation are preserved while enabling development. The commission noted that co‑location raises questions about interconnection, cost allocation, and how to measure impacts on consumer prices and reliability.
What happens next: the new docket consolidates prior filings and the technical conference record into a single proceeding; stakeholders have the stated opportunity to file initial comments and replies within the announced comment periods. The commission’s order also directs PJM to respond on a short timeline. Additional technical conferences and filings may follow as the record develops.
Provenance: discussion introducing and explaining Item E1 appears in the meeting discussion beginning with the chair’s item introduction and continuing through Commissioner Rosner’s remarks (topic spans SEG 139–SEG 320).
