The United States Energy Secretary has announced an initiative to accelerate the connection of datacenters to the national power grid. This directive, issued to the Federal Energy Regulatory Commission (FERC), aims to streamline the process for integrating these energy-intensive facilities into the electricity infrastructure.
In a communication to FERC, which is responsible for overseeing electricity transmission, Secretary Chris Wright emphasized the necessity of expediting connection approvals. One of the proposed measures is to cap the time taken for reviews of connection requests to no more than 60 days. The Department of Energy (DOE) has noted that the United States is facing an unprecedented increase in electricity demand, which is significantly influenced by the rapid expansion of datacenters driven by advancements in artificial intelligence.
A report from Deloitte Insights has projected that the energy consumption of these datacenters could potentially increase by more than 30 times by the year 2035 if current trends continue. The same report highlights the extensive delays in connecting new projects to the grid, with some requests currently facing waits of up to seven years.
Secretary Wright”s proposals aim to address these delays by asserting that the interconnection of large energy loads, particularly datacenters, should fall within FERC”s authority. The new rules would specifically target new loads exceeding 20 megawatts, establishing standardized requirements for study deposits, readiness, and penalties for withdrawal to deter speculative applications and clarify actual demand.
In addition to these reforms, Secretary Wright advocates for the expedited processing of requests from applicants willing to agree to curtailable loads, which can be temporarily reduced or turned off to help balance the grid. He has requested feedback regarding appropriate timelines for this expedited study process, questioning whether it can indeed be completed within 60 days.
Furthermore, the Secretary has asked FERC to eliminate unnecessary obstacles for preliminary hydroelectric power permits, indicating a shift towards disregarding opposition from third parties regarding project locations. In his letter, he stated that recent commission decisions have denied several preliminary permits based on landowner objections, and he proposes that a new regulation be introduced to clarify that such opposition should not be grounds for permit denial.
The DOE has been proactive in tackling the issues surrounding energy generation and the integration of datacenters, working to alleviate permitting delays. In a recent initiative, the department selected ten companies to collaborate on testing advanced nuclear reactor technologies, with the goal of accelerating the deployment of new power sources. Additionally, it has identified four federal sites for private sector datacenter and energy generation collaborations.
In a related development, the President of the United States recently hosted a gathering of prominent figures from Silicon Valley, where he committed to removing barriers that hinder the connection of datacenters to the electric grid and ensuring they receive sufficient power supply.
