Large data centers would have to shoulder their full grid costs and back projects with financial assurances under a bipartisan permitting bill introduced Sept. 30. The Bipartisan American Affordability and Jobs Act applies those requirements to facilities of 20 MW or more. It also narrows National Environmental Policy Act reviews and would allow the Federal Energy Regulatory Commission (FERC) to permit interstate transmission lines after a year of state inaction. The Senate is targeting a procedural vote Nov. 9.
Enverus Intelligence® Research has flagged two bottlenecks the bill seeks to address: speculative load clogging interconnection queues and transmission lagging behind load growth. As interconnection timelines lengthen, more developers are turning to behind-the-meter (BTM) generation. Our latest forecast projects nearly 35% of data center capacity will be served by BTM resources by 2035 (Figure 1).
Transmission constraints are showing up as congestion premiums in parts of ERCOT and PJM. The bill takes on both. Its financial-assurance requirement resembles AEP Ohio’s 2025 data center tariff, which cut the utility’s data center queue by about half. By discouraging speculative interconnection requests and accelerating transmission development, the legislation could make grid service more attractive relative to BTM alternatives. FERC backstop siting authority could also speed permitting for interstate transmission projects that help reduce congestion premiums.
The outcome of the Nov. 9 vote remains uncertain, but the shift the bill seeks to address is already reflected in our forecast, which tracks announced grid-fed and BTM data center capacity across every major U.S. power market through 2035.
This blog offers just a glimpse of the powerful analysis Power and Energy Transition Research delivers on the trending themes. Don’t miss the full picture.
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DID YOU KNOW?
Pattern Energy’s 550-mile SunZia transmission line, which runs from central New Mexico to south-central Arizona, took about 17 years to permit and roughly 2.5 years to build. Its initial federal environmental review took seven years, more than triple the two-year deadline proposed under the bipartisan Senate permitting bill.
Top Three Takeaways:
1: What is driving the shift toward behind-the-meter generation for data centers?
As interconnection timelines lengthen, more developers are turning to BTM generation. Enverus Intelligence® Research projects nearly 35% of data center capacity will be served by BTM resources by 2035.
2: What does the bipartisan permitting bill require of large data centers?
Facilities of 20 MW or more would have to pay their full grid costs and back projects with financial assurances. The bill also narrows National Environmental Policy Act reviews and would allow FERC to permit interstate transmission lines after a year of state inaction.
3: How could the bill affect transmission congestion in ERCOT and PJM?
Transmission constraints are showing up as congestion premiums in parts of ERCOT and PJM, and the bill targets both speculative queue requests and transmission delays. Its financial-assurance requirement resembles AEP Ohio’s 2025 data center tariff, which cut the utility’s data center queue by about half.
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About Enverus Intelligence® | Research, Inc. (EIR)
Enverus Intelligence® | Research, Inc. (EIR) is a subsidiary of Enverus that publishes energy-sector research focused on the oil, natural gas, power and renewable industries. EIR publishes reports including asset and company valuations, resource assessments, technical evaluations, and macroeconomic forecasts and helps make intelligent connections for energy industry participants, service companies, and capital providers worldwide. See additional disclosures here.
