Delaware has joined several states and federal agencies seeking to more closely regulate the impact of large loads interconnecting to the grid. On Sept. 22, 2025, the Delaware General Assembly introduced Senate Bill 205, which would amend Title 26 of the Delaware Code to establish a new regulatory framework for entities seeking to use 30 megawatts (MW) or more of electricity within the state that will directly interconnect to the PJM Interconnection (PJM) transmission grid. The bill would require such entities to obtain a “Certificate to Operate” (COP) from the Delaware Public Service Commission (PSC) prior to commencing operations or increasing existing facility usage to the 30 MW threshold.
The bill would enhance oversight of projects requiring significant energy (e.g., data centers), help ensure parity regarding cost allocation issues related to transmission infrastructure and upgrades, promote environmental and public safety standards, and align new developments with state energy and climate objectives. The legislature likely will not act on the bill until at least January 2026, and even if it passes, the Delaware PSC will still need to adopt implementing regulations. Additionally, it remains to be seen how state initiatives like this will interact with potential federal level processes contemplated by the Federal Energy Regulatory Energy Commission (FERC).
Read on for a description of the proposed bill and its potential implications for development of large load in Delaware.
Key Provisions
The COP requirement would apply to any person or entity initiating the business of using 30 MW or more of electricity, as well as to modifications of existing facilities that would increase usage to this threshold. The COP requirement would only apply to projects interconnecting to the PJM grid.
The bill would exempt public utilities operating within their service territories from the requirement, although how this exemption will be implemented in practice is unclear.
The law would further apply to all development plans that have not received “final plan approval” from local jurisdictions as of the enactment date.
Application and Review Process
The bill would require applicants for a COP to submit a written application to the Delaware PSC. The PSC will prescribe the application form in a later rulemaking, but it must require applicants to describe the impact of the plan on transmission capacity, any associated upgrades to transmission or distribution facilities, the quantity and type of on-site backup power, if any, a “study of impact of the plan on electricity costs in Delaware” and “a study of the impacts of the plan on grid reliability in Delaware.”
The PSC would have the authority as part of the COP process to (1) require financial commitments from the applicant to protect against “stranded transmission investments”; (2) require financial contributions in furtherance of grid modernization for any necessary transmission investment; and (3) require the applicant to secure additional generation commitments by a set timeline before the new load can be connected and supplied.
The PSC would be required to act on a completed COP application within 90 days, with a possible extension of up to 90 additional days for good cause and if it determines that doing so is in the public interest.
Evaluation Criteria
As proposed, the PSC would be required to consider the following factors when evaluating COP applications:
- Whether relevant studies and approvals were completed by PJM, and whether PJM assured adequate energy and capacity supply is available and issued any required approval to construct and operate the facility;
- The plan’s impact on the safe, adequate and reliable operation of electric supply services;
- Potential effects of the plan on existing utility rights of way and other utility facilities;
- Economic impacts, ratepayer effects and consistency with Delaware’s greenhouse gas emissions reduction targets and renewable portfolio standards;
- Potential of the plan to preclude or facilitate future renewable energy projects and minimize environmental impacts;
- Public health, safety and welfare considerations;
- The applicant’s (or its affiliate’s, partner’s or parent company’s) experience, expertise and long-term viability;
- Engineering and technical design of any proposed transmission facilities; and
- Impacts on local transmission facilities.
Suspension, Revocation and Transfer
If enacted, the bill would allow the PSC to suspend or revoke a COP for material noncompliance with conditions, orders or rules, or for failure to operate safely and reliably. COPs would be nontransferable without written PSC approval, which would require evaluation of the transferee’s qualifications.
The State Energy Office and local governments with land use jurisdiction would be granted intervention rights in PSC proceedings to address impacts on state energy and climate plans, renewable standards and public safety or environmental concerns. In addition, the PSC would be required to submit an annual report on COP applications and their disposition to state officials by Dec. 31 each year.
Next Steps and Implications
The bill was introduced on Sept. 22, 2025, and was assigned to the Environment, Energy & Transportation Committee in the Delaware Senate. However, the Senate is currently in recess and is not expected to be back in session until January, unless a special session is called. Accordingly, action on SB 205 is likely to occur in early 2026.
If the bill is enacted, the Delaware PSC will need to adopt implementing regulations, but the basic requirements and considerations related to the COP are already set in the text of the bill.
Notably, the legislation applies specifically to transmission-level interconnections and was introduced just ahead of a letter and Advanced Notice of Proposed Rulemaking issued by the Department of Energy to the FERC in October directing FERC to consider implementing a federal-level rulemaking proceeding applicable to large electricity consumers interconnecting to the transmission grid. It will be important to evaluate how federal and state obligations overlap, if at all.
As drafted, the bill demonstrates the interplay between FERC and state processes that large load customers and electric providers need to consider. While not stated as a requirement, the bill would require the Delaware PSC to “consider” in its evaluation of the COP whether any related PJM studies are completed, and whether adequate long-term supply contracts are finalized. The list of considerations appears to be discretionary — there is not specified criteria that, if demonstrated, would guarantee issuance of a COP. These issues may be further developed in the Delaware PSC’s rulemaking process. However, as proposed, the COP appears to be an additional, state-level discretionary approval that would be obtained relatively late in the development cycle.
The McGuireWoods Energy Enforcement & Regulatory Counseling Practice Group continues to monitor this legislation and other state and federal proceedings involving the interconnection of large loads as these issues continue to develop.