Training AI models takes power. A lot of power. And that’s exactly the problem: in the US, data centers sometimes wait years to connect to the grid. The Federal Energy Regulatory Commission (FERC) just stepped in — with a decision that could fundamentally reshape AI infrastructure buildout.
What happened
On June 18, FERC unanimously issued ‘show cause’ orders to six regional grid operators — PJM, MISO, SPP, CAISO, ISO New England, and NYISO. Texas (ERCOT) is exempt because it runs its own grid.
The directive is clear: either grid operators demonstrate within 60 days that their existing rules for large customers like data centers are adequate — or propose reforms. They also have 30 days to submit a report explaining how they plan to ensure sufficient generation capacity for current and future large loads.
FERC Chair Laura Swett called AI grid integration a ‘national priority.‘
Why this matters
The numbers are staggering — and concerning. Microsoft has added over 4 gigawatts of new capacity in the past 18 months. CoreWeave is targeting 1.7 GW by the end of 2026. Wholesale electricity rates are up as much as 267% in some regions compared to five years ago.
The normal rulemaking process (Notice of Proposed Rulemaking) takes years. FERC bypassed it entirely in favor of targeted orders — an unusual step that signals how urgent the problem has become.
The other side
While FERC clears the path for faster data center connections, there’s no answer to the real question: where does the electricity come from? By the end of 2023, grid connection requests for power plants already exceeded the total capacity of the existing fleet.
Meanwhile, the day before the FERC decision, the Trump administration paid $765 million to wind developer Invenergy — to cancel offshore wind leases. One of those projects would have generated up to 2.4 GW. That’s enough to power roughly 1.8 million homes.
So FERC is clearing the queue — but there aren’t enough power plants in line to meet demand. This tension isn’t going away.
Sources: TechCrunch, American Action Forum