DOE Directs FERC to Regulate Large Load Interconnection: What it Means for the Energy Storage Industry

The U.S. DOE is making a move that could fundamentally change how large power consumers, like AI data centers, connect to the grid.

In an urgent letter dated October 23, 2025, the Secretary of Energy directed the Federal Energy Regulatory Commission (FERC) to initiate rulemaking on the interconnection of "large loads" (>20MW) to the interstate transmission system. This is to ensure "timely, orderly, and non-discriminatory" access to the transmission system.

What You Need to Know: Key Principles from the ANOPR

The DOE's Advance Notice of Proposed Rulemaking (ANOPR) sets forth 14 principles intended to guide FERC's forthcoming rule. Two principles, in particular, speak directly to the value of energy storage:

1. Expedited Interconnection for Curtailable and Dispatchable Loads

The ANOPR strongly suggests an accelerated path for interconnection applications that are willing to be flexible:

• Large loads that agree to be curtailable will have their interconnection study expedited.

• Hybrid facilities that agree to be both curtailable and dispatchable will also have their studies expedited.

This is where BESS comes in. For a large data center or manufacturing facility, coupling it with an energy storage system (creating a hybrid facility) allows it to offer a dispatchable resource to the grid operator. This ability to be controlled through dispatch must be sufficient for the system operator to integrate the facility. This flexibility should qualify such a project for the proposed expedited study process, potentially cutting months or years off the typical interconnection queue timeline.

2. Encouraging Hybrid Facilities with Shared Interconnection

The proposal is designed to incentivize the co-location of loads and generation/storage.

• The ANOPR suggests that load and hybrid facilities should be studied together with generating facilities to minimize the need for costly network upgrades.

• A hybrid facility will be studied based on the net injection and/or withdrawal rights requested11. For instance, a 500MW load co-located with a 600 MW generating facility might only seek 100MW of net injection rights.

This is a massive win for behind-the-meter BESS and co-located storage. By pairing a large load with a generating facility (like solar or wind) and a BESS, a project can strategically manage its net power draw and injection, drastically reducing the required scope and cost of its network upgrades.

What's Next?

• FERC has been given a deadline of April 30, 2026, to consider and take final action on this proposal. We will be closely monitoring the rulemaking process.

For companies with large load demands, especially those looking to deploy new data centers or expand manufacturing, the strategic pairing of your load with an intelligent, dispatchable energy storage system is no longer just an operational decision, it is quickly becoming a necessary regulatory compliance and project acceleration strategy.