United States: Utilities

As AI-driven data centers push electricity demand to unprecedented levels, the race to build digital infrastructure is becoming a race for power itself. Industry experts are now questioning whether aging electric grids can deliver the capacity, reliability, and interconnection speed needed to support next-generation facilities, and whether behind-the-meter solutions can truly replace more than a century of grid engineering and operational experience.

Texas has launched a sweeping investigation into hundreds of data center developments that failed to comply with mandatory water use surveys, marking the latest escalation in a seven-week regulatory crackdown. The state's actions have frozen permits, paused interconnection studies, and exposed projects to criminal and civil enforcement, all while the industry faces mounting scrutiny over its rapidly growing demands on electricity and water infrastructure. With multiple state agencies now coordinating enforc

Texas Governor Greg Abbott has directed state agencies to halt all data center permits until comprehensive audits assess the projects' impacts on electric infrastructure, residential ratepayers, and water resources. The directive requires data centers to fully fund necessary electric infrastructure and comply with enhanced reporting requirements, while the governor signals potential legislative action to codify new protections and phase out certain tax incentives.

The California Legislature passed SB 886 (Padilla), the California Technology Innovation and Ratepayer Protection Act, which requires the California Public Utilities Commission (Commission) to adopt new tariffs and update existing electric rules to ensure that electric utility costs for serving data centers are not shifted to ratepayers. Governor Newsom has until the end of September to sign or veto this bill and the accompanying data center power regulation bill, AB 2383 (Zbur).

The U.S. Department of Transportation has launched America's Great Corridors of Commerce, a voluntary initiative to accelerate utility deployment along existing transportation rights-of-way through public-private partnerships and federal support. Meanwhile, Congress is pursuing targeted legislation on broadband access and transmission planning, creating three parallel federal efforts that share a premise but diverge on mechanism—voluntary incentives versus regulatory mandates versus study-first ground

Massachusetts Governor Maura Healey has issued Executive Order No. 658, establishing a comprehensive statewide framework for regulating large-scale data center development. The order requires developers of facilities with peak electricity demand exceeding 25 megawatts to meet new standards addressing community benefits, grid impacts, environmental concerns, and workforce considerations before receiving state permits.

As California lawmakers prepare to consider new wildfire legislation, a new report from Consumer Watchdog and coverage by the Los Angeles Times are drawing renewed attention to the growing debate over who should bear the financial responsibility for catastrophic wildfires.

PJM's Board of Managers has directed the filing of proposals for a Reliability Backstop Procurement and Interim Resource Adequacy Service with FERC, following an intensive stakeholder process to address resource adequacy threats in the region. The proposals include a Large Load Registry, procurement mechanisms beginning in September 2026, and new requirements for large customers without sufficient capacity as of June 1, 2027.

Trillions of dollars in AI capital are competing for approximately 100 gigawatts of electric power, creating an unprecedented challenge for the nation's electric grid. This analysis explores how regulators can facilitate a critical connection between data center developers seeking capacity and the untapped potential of demand-side resources—particularly household-level energy efficiency measures and distributed energy resources that could unlock substantial grid capacity without building new generatio