The Transmission Study That Recommended Nothing
The Federal Energy Regulatory Commission submitted its congressionally mandated study on interregional transmission this month. Congress ordered the study through the Fiscal Responsibility Act to lay groundwork for transmission legislation. FERC declined to provide any, citing two objections: the study’s demand data was outdated, and the analysis lacked cost-benefit comparisons for building additional lines.
“The commission staff makes no recommendation regarding potential statutory changes in response to the Interregional Transfer Capability Study,” FERC wrote in its transmittal.
The demand data was indeed outdated. It also understated what is coming.
The revised forecast. The Electric Power Research Institute released updated projections this week showing data centers could consume 9 to 17 percent of all U.S. electricity by 2030, up from 4.5 percent today. The numbers are roughly 60 percent higher than EPRI’s prior estimates. Virginia, the nation’s data center capital, faces the most concentrated impact: 41 to 59 percent of state electricity consumption by decade’s end. Seven additional states, including Arizona, Indiana, Iowa, Nebraska, Nevada, Oregon, and Wyoming, could see data centers consuming more than 20 percent of available power.
FERC cited bad data to justify inaction. The actual demand trajectory is worse than what Congress had when it ordered the study.
The construction gap. Transmission permitting, cost allocation, and multi-jurisdictional planning disputes continue to constrain high-voltage line construction well below what load growth requires. Americans for a Clean Energy Grid warned in its response to the FERC report that insufficient interregional transfer capacity threatens grid reliability and economic competitiveness. Generation, by contrast, is arriving at record speed.
The Energy Information Administration projects 86 gigawatts of new generating capacity in 2026, nearly doubling the 53 gigawatts installed in 2025 and setting a record. Battery storage alone accounts for 24.3 gigawatts, or 28 percent of all planned additions. Solar contributes 43.4 gigawatts, with Texas hosting 40 percent of national solar construction at 17.4 gigawatts. Generation capacity is scaling at a pace not seen in two decades. Transmission capacity is not.
States fill the vacuum. With federal transmission policy frozen, state regulators and legislatures are responding to the demand crisis independently.
Indiana launched an unprecedented step this week. The Indiana Utility Regulatory Commission announced a formal Investigative Inquiry on Energy Affordability, summoning all five investor-owned utilities, AES Indiana, CenterPoint, Duke Energy Indiana, Indiana Michigan Power, and NIPSCO, to a March 24 hearing. Indiana is a PJM state where Meta recently broke ground on a $10 billion data center campus, and under EPRI’s projections, data centers could exceed 20 percent of the state’s electricity consumption by 2030. The inquiry is the first of its kind in Indiana, and the commission is empowered to take formal regulatory action based on its findings.
Florida took a different path. A House committee advanced legislation this week restricting data center siting within five miles of schools or residential property unless unanimously approved by local governments, banning non-disclosure agreements between developers and municipalities, and requiring tech companies to pay the full cost of their utility consumption. Florida joins a wave of more than 300 state bills nationwide addressing data center energy costs.
These are not coordinated strategies. Indiana is investigating whether utility rate structures have kept pace with affordability. Florida is restricting where data centers can physically locate. Both are reactions to the same problem: demand growth that federal infrastructure policy has declined to address.
What fills the gap. When transmission cannot deliver power from where it is generated to where it is consumed, power must be generated closer to where it is consumed. The evidence suggests that substitution is already happening at scale.
The EIA’s 86 gigawatt forecast is dominated by resources that often connect at or below the transmission level. Solar and battery storage together account for 79 percent of planned additions. Texas entered 2026 with 13.9 gigawatts of battery capacity, nearly double the 7.8 gigawatts it had twelve months earlier, according to Modo Energy. ERCOT now projects over 114 gigawatts of combined wind, solar, and battery capacity by year-end. Texas builds quickly in part because its single-state market sidesteps the multi-jurisdictional transmission planning disputes that paralyze PJM and other regional operators.
The private sector is not waiting either. Fermi America secured a clean air permit this week for 6 gigawatts of natural gas generation at its planned 11 gigawatt power campus near Amarillo, which would integrate gas, nuclear, solar, and battery storage for hyperscale AI data centers. NRG Energy, fresh off acquiring the roughly 13 gigawatt LS Power portfolio, is targeting 1 gigawatt of signed data center co-location power contracts in 2026. When the grid cannot deliver, companies with sufficient capital are building around it.
The institutional gap. FERC had a congressional mandate, a study identifying interregional transfer needs, and a demand forecast that grew 60 percent while the study was being drafted. It recommended nothing.
Transmission remains the most efficient way to move power across distances. No volume of distributed batteries replaces a 500 kilovolt line connecting surplus generation on the plains to deficit load in the mid-Atlantic. But efficiency is an academic virtue when construction is not happening. The structural barriers to transmission, permitting timelines, cost allocation disputes, and interstate coordination failures, are not new. Neither is the gap between identified need and actual buildout.
By the time Congress acts on transmission, if it acts at all, 86 gigawatts of generation will have been built in a single year. Much of it will sit at the distribution edge or behind the fence line, not because that is optimal, but because it is possible. The study concluded with a finding of need and a recommendation of nothing. The market heard both.
Sources
FERC Brushes Off Transmission Study Mandated by Congress (E&E News)
FERC ITC Report and Transmission Reforms (Americans for a Clean Energy Grid)
Data Centers’ Share of U.S. Electricity Seen Doubling by 2030 (E&E News)
EPRI: Data Centers Could Consume Up to 17% of U.S. Electricity by 2030 (GlobeNewsWire)
Solar and Storage to Lead Record-Breaking 86 GW of New U.S. Capacity in 2026 (EIA Today in Energy)
Solar and Storage to Lead Record-Breaking 86 GW of New U.S. Capacity in 2026 (pv magazine USA)
Indiana Utility Regulators Call In Big Five Energy Providers for Affordability Investigation (Indiana Capital Chronicle)
Indiana Regulators Launch Utility Affordability Inquiry (E&E News)
Florida House Panel Advances Data Center Bill Despite Business Opposition (E&E News)
ERCOT Battery Buildout 2025 Annual Report (Modo Energy)
Texas Power, Energy Storage, Battery, Data Centers (Houston Public Media)
Fermi America Secures Final 6GW Clean Air Permit (PR Newswire)
NRG Energy Q4 2025 Earnings (Yahoo Finance)