US Utilities Tighten Grid Rules for AI Data Centers
US utilities and grid operators are demanding higher rates, longer contracts, collateral and steep engineering study fees from data-center developers to screen out speculative or duplicate grid requests. TechRadar, citing Wood Mackenzie and other reporting, says US developers have requested 1,066GW of connections and that utilities are expected to commit to about 28%. After Exelon introduced transmission security agreements, its high-probability data-center load fell from 18GW at the end of 2025 to about 11GW in the second quarter. The report does not establish how much of the requested capacity would serve AI workloads rather than other data-center uses.
The tighter requirements address the risk that utilities build grid infrastructure for projects that never materialize while shared costs fall on other customers. They also reflect the difficulty of preparing for large loads without relying on the most optimistic pipeline estimates.
- US data center developers have requested 1,066GW of grid connections, but Wood Mackenzie expects utilities to commit to only about 28%
- Utilities are demanding collateral, longer contracts, and study fees; Exelon's high-probability load fell from a whopping 18GW to 11GW once it insisted on the former
- Because grid costs are shared, phantom demand risks landing on household bills, and nobody knows how much of it is real yet
US utilities and grid operators are now demanding higher rates, longer contracts, collateral, and steep engineering study fees from data center developers, in an attempt to weed out what the industry calls "phantom" data centers.
Reporting from The Wall Street Journal claims the reasoning is straightforward: Grid costs are shared, so if a utility builds substations and transmission lines for a project that never shows up, everyone else on the network ends up helping to pay for them.
The numbers back up the nerves in play: developers have requested 1,066GW of grid connections for US data centers, according to a Wood Mackenzie analysis first reported by Bloomberg in August 2026, a figure equal to roughly 83% of the country's entire utility-scale generating capacity at the end of 2025.
#Wood Mackenzie#Exelon#PJM#Halcyon#Capgemini#AI data centers