NERC Sounds the Alarm on Large Load Integration

The rapid growth of data centers, AI infrastructure, and cryptocurrency mining is putting pressure on the Bulk Electric System (BES) — and a new NERC report reveals that most utilities are not yet prepared to handle it.

In September 2025, NERC issued a Level 2 Alert requiring Distribution Providers (DPs), Transmission Owners (TOs), Transmission Planners (TPs), Balancing Authorities (BAs), and other registered entities to report on their readiness to interconnect, study, commission, and operate Large Loads.

Responses were due January 28, 2026, and NERC’s Aggregated Report of the responses are worth paying attention to.  NERC’s focus this upcoming year will impact TOs, TOPs, BAs, and PCs – and possibly DPs.

The Scale of What’s Coming

Forecasts submitted by entities indicate that large load demand could increase by as much as 300 GW between 2028 and 2030, with data centers — traditional, AI-focused, and crypto mining — making up the overwhelming share of that growth.

What the NERC Alert Responses Tell Us

The results reveal widespread gaps across nearly every functional entity category:

• Most entities lack formal large load procedures. The majority of TOs and DPs have not established clear facility design, modeling, or performance criteria in their interconnection requirements for large loads — and roughly half have no plans to address this within two years.
• Modeling is inadequate. About three-quarters of all data center load models are insufficient to capture dynamic behavior. Nearly 25,500 MW of operational data center load relies on generic model representations that simply weren’t designed with computational loads in mind.
• Commissioning processes are largely absent. Most entities have no formal commissioning process to verify that large load facilities will operate in line with studied designs before entering commercial service.
• Coordination is weak. Most entities report no structured process for coordinating with TOs, DPs, BAs, or RCs on protection requirements, post-disturbance recovery, or real-time operational protocols. Notably, many entities did not contact their large load customers at all when responding to the Alert.
• Planning forecasts don’t yet account for Large Loads. Only about half of Transmission Planners, Planning Coordinators, and Resource Planners have processes to incorporate large loads into near- or long-term demand forecasts — and consistency across those processes is lacking.
• Many entities are waiting on their ISO or RTO. A recurring theme in the responses is deference to ISOs and RTOs before taking internal action. While coordination with those entities is appropriate, it’s creating a gap at the local level that NERC has taken notice of.

What Comes Next

NERC has outlined targeted actions based on these findings:

• A Level 3 Alert (Essential Action) is expected in May or June 2026, carrying mandatory response requirements focused on the most critical reliability gaps identified in this report.
• Beginning in Q2 2026, NERC will start drafting registry criteria updates and new or revised Reliability Standards to formally address computational load integration.
• A Reliability Guideline from the Large Loads Working Group is expected by mid-2026, sharing best practices for entities looking to get ahead of the curve.

The Bottom Line

The findings confirm what policy leaders have suspected: the grid’s regulatory and operational frameworks were not built with gigawatt-scale data center loads in mind. The interconnection requirement questions asked in this Alert are likely to reappear in future Standard Authorization Requests (SARs) – so entities that closely monitor and follow NERC Large Load integration guidance will be better positioned when the Level 3 Alert arrives and new or revised standards follow.

As always, if you have questions about how these developments may affect your entity or need help navigating upcoming NERC obligations, please reach out to Utility Services.