Effective March 25, 2022, the Electric Reliability Council of Texas (“ERCOT”) began requiring documentation from large electrical loads like cryptocurrency miners before allowing them to connect to the Texas power grid. Through a Market Notice, ERCOT established an interim process requiring transmission service providers (“TSPs”) to submit interconnection studies that meet the requirements of the National Electric Reliability Council’s Reliability Standard FAC-00202 for interconnection of certain large loads. Specifically, TSPs will be required to submit the studies for interconnection of the following types of loads:
- New loads not co-located with a Resource with total demand within the next two years of 75 MW or greater;
- Existing loads not co-located with a Resource increasing total demand by 75 MW or greater within the next two years;
- New loads co-located with a Resource with total demand within the next two years of 20 MW or greater; or
- Existing loads co-located with a Resource increasing total demand by 20 MW or greater within the next two years.
ERCOT will review the studies and identify any issues that must be resolved prior to allowing these loads to be included in ERCOT’s Network Operations Model, register as Load Resources, and/or receive approval to energize. These requirements are not specific to cryptocurrency miners, and any load meeting these requirements is subject to the study requirement. Nevertheless, it is believed that the growth in cryptocurrency mining operations has motivated ERCOT to institute these requirements, and cryptocurrency miners working to develop facilities in Texas that will rely on TSPs to connect them quickly to the Texas grid should factor these standards into their plans. The market notice is effective immediately, so any load meeting the above qualifications is subject to the new requirement regardless of the current stage of interconnection.
While these requirements are “interim” in nature, they were implemented just before ERCOT established a task force to determine how to manage the increasing number of cryptocurrency miners connecting to the grid, and to address other issues associated with increased load on the system. We would therefore expect the final standards to represent some evolution as the task force studies these issues in greater detail. The task force holds its first meeting on April 14 and will subsequently propose the scope for its activities to ERCOT. Husch Blackwell will be following these developments closely on behalf of its clients. Please contact its energy regulatory professionals if you have any questions.