On June 18, 2026, the Federal Energy Regulatory Commission (FERC) took highly anticipated action to facilitate access by large loads, such as AI data centers and manufacturers, to the electric grid, while protecting other customers from costs caused by large loads. FERC issued show cause orders to each of the six RTOs/ISOs and their transmission owners, directing them to justify how their existing tariffs provide for the interconnection of large and co-located loads to the electric grid or to propose revisions to their tariffs. FERC has repeatedly expressed that how the transmission system is studied, planned, expanded and operated is critical to the United States winning the AI race and onshoring manufacturing.
These six orders, directed at PJM Interconnection, L.L.C. (PJM),[1] Midcontinent Independent System Operator, Inc. (MISO),[2] Southwest Power Pool, Inc. (SPP),[3] California Independent System Operator Corporation (CAISO),[4] ISO New England Inc. (ISO-NE),[5] and New York Independent System Operator, Inc. (NYISO),[6] mark the next phase of the process that began in October 2025, when the U.S. Department of Energy directed FERC to issue an Advanced Notice of Proposed Rulemaking (ANOPR) related to large load interconnections, proposing 14 planning principles for FERC to consider. In April 2026, FERC committed to address the ANOPR’s concerns by the end of June 2026 in a manner that is “quick, efficient, and legally durable.”
Rather than issue a rulemaking that would be generally applicable nationwide, the orders require each FERC jurisdictional RTO/ISO to justify their existing procedures or develop new procedures for the interconnection of large and co-located loads. As discussed in more detail below, FERC identified five categories of proposed reforms.
Chairman Swett’s concurrence in each order explains that proceeding via six individual show cause orders will enable FERC to “spearhead lasting reform much more expeditiously.” While the orders are limited to RTO/ISO dockets, Chairman Swett and Commissioner LaCerte, as well as FERC Staff in their presentation, and the plain text of the orders, all strongly recommend transmission providers operating outside RTO/ISO markets to consider proposals for their territories to be filed under FPA Section 205.
Read on for more details on the orders to show cause and for key upcoming dates.
Five Categories of Proposed Reforms
Through the orders, FERC identifies five categories of reform that each of the RTOs/ISOs must demonstrate they already use or propose to adopt to facilitate the ability of large loads to be served by the grid.[7] These five categories of reform cover how those that serve large load customers and the RTOs/ISOs will develop, study and share information to accelerate electric service to large load customers and to protect other electric customers from costs caused by large loads:
- Application and study processes. Application process, study procedures and ongoing operational requirements for large load transmission service, including consideration of alternative transmission technologies.
- Cost transparency and cost shifting protections. Additional transparency concerning network upgrade costs, pro forma cost recovery agreements and mechanisms to prevent cost shifting among transmission customers.
- Co-location arrangements. Rates, terms, and conditions for co-location arrangements.
- Flexible large loads and behind-the-meter generation. Transmission services for flexible large loads, co-located loads and load with behind-the-meter generation.
- Electrically proximate large load. Rates, terms and conditions applicable to interconnection customers serving electrically proximate large load[8] or co-located load.
In addition, FERC directed each RTO/ISO to explain how it intends to ensure that adequate generation will be available to serve existing and new large loads. These generation adequacy reports are due by July 20, 2026.
Importantly, the orders clarify that they are not intended to disrupt existing agreements that large loads have negotiated, or are in the process of negotiating, for the provision of transmission service.[9] FERC stated that it is not looking for a “one-size-fits-all” approach in solutions proposed by the various RTOs/ISOs and directed that any tariff revisions should allow a reasonable amount of time to finalize commercial agreements that are nearing completion as of the date the proposed tariff revisions are filed at FERC.[10] FERC strongly encouraged RTOs/ISOs to file voluntary FPA Section 205 tariff revisions rather than waiting for FERC to impose replacement tariffs.[11]
It is noteworthy that the commissioners saluted SPP’s and PJM’s progress on large load issues to date and encouraged similar action in other RTO/ISO regions. Separately, FERC issued a further order on PJM’s ongoing compliance efforts, accepting some of PJM’s proposed implementation of tariff revisions specific to large load and directing further compliance on others.[12]
Key Deadlines
Each of the orders established the following deadlines, measured from the date of issuance (June 18, 2026):
| Key Deadlines | |
|---|---|
| July 9, 2026 (21 days) | Intervention Deadline |
| July 20, 2026 (30 days) | RTO/ISO Resource Adequacy Informational Report |
| August 3, 2026 (45 days) | RTO/ISO Deadline to Request up to 90-day abeyance |
| August 17, 2026 (60 days) | RTO/ISO Deadline to Show Cause and Answer Briefing Questions |
| September 16, 2026 (30 days after RTOs/ISOs’ filings) | Stakeholder Deadline to Comment on RTO/ISO Filings |
The orders also establish a refund effective date, at the earliest possible date, i.e., the date that the order is published in the federal register. As of the date of this alert, the Orders have not yet been published in the Federal Register.
Next Steps
Creating separate orders to show cause proceedings rather than operating through a rulemaking proceeding has several practical implications. First, unlike rulemakings that have no intervention requirements, entities wishing to participate in any of the show cause proceedings will need to intervene in the docket or dockets by July 9, 2026. Further, with FERC’s encouragement for the RTOs/ISOs to proactively file Section 205 proceedings rather than wait for action, there may be a proliferation of filings related to large load, and it will be important to monitor FERC filings and orders to keep abreast of and participate in proceedings of interest.
Finally, FERC did not foreclose future nationwide action applicable to all transmission providers, including those in non-RTO regions. FERC is leaving the existing rulemaking docket (Docket No. RM26-4-000) open and encourages entities to file comments in that docket as necessary. Furthermore, FERC cautioned that it could take additional action to facilitate the connection of large loads to the grid.
McGuireWoods continues to monitor these proceedings and other developments related to large load integration. For questions, contact the authors or a member of the McGuireWoods Federal Energy Regulatory Commission team.
[1] See generally Docket No. ER26-67-000.
[2] See generally Docket No. ER26-70-000.
[3] See generally Docket No. ER26-68-000.
[4] See generally Docket No. ER26-71-000.
[5] See generally Docket No. ER26-72-000.
[6] See generally Docket No. ER26-69-000.
[7] The substance of each show cause order is largely identical, with some differing language tailored based on the existing processes in the RTO/ISO.
[8] The orders define “electrically proximate large load” as large load that is “sufficiently electrically close to the interconnection customer’s requested point of interconnection, such that the impact on the transmission system of the combination of the generating facility and the load, with the exception of the transmission facilities between the two, will be effectively the same as if they were located at the same substation (e.g., large load that is located no more than two substations away from the generating facility).”
[9] See, e.g., Midcontinent Independent System Operator, Inc., 195 FERC ¶ 61,212 at PP 5, 36 (2026).
[10] Id.
[11] See, e.g., Midcontinent Independent System Operator, Inc., 195 FERC ¶ 61,212 (2026) (Swett Concurrence at P 8; Rosner Concurrence at P 16; See Concurrence at P 4; Chang Concurrence at P 3; LaCerte Concurrence at P 5).
[12] PJM Interconnection, L.L.C., 195 FERC ¶ 61,209 (2026).