Gov. Sherrill signed the reconciled S731/A796 into law on June 30, 2026, ordering the Board of Public Utilities to build a mandatory tariff class for “large data center customers” — a size threshold the board must set at 50 MW or lower — that pushes grid, stranded-cost, and reliability risk onto the data centers instead of everyone else’s bill. Data Centers may meet the requirements by direct energy savings or reducing consumer use. Thanks to Alison F. Takemura for the pointer.
What the tariff has to do
The bill tells the Board of Public Utilities to design standards, within 12 months, that force each large data center customer to eat its own costs: no cross-subsidy from residential or small-commercial ratepayers, no stranded-cost exposure if a project folds or under-consumes, and full pass-through of interconnection, system-impact, and facilities-study costs. It also requires 10-year, 85%-take financial guarantees, deposits or credit-backed commitments, and disclosure of any “substantially similar” pending interconnection requests elsewhere — aimed squarely at speculative queue-stuffing. There’s an explicit anti-evasion clause covering corporate structuring, project segmentation, and behind-the-meter workarounds.
The bill also builds in a curtailment hierarchy — large data centers get shed before residential customers in emergencies, and that shed counts as firm load, not a reliability event to be quietly absorbed.
The flexibility bargain, and what got fought over in reprints
Where it gets interesting for the Grid 2.0 beat: the final bill ties priority interconnection to flexibility commitments — data centers that commit to bringing their own clean generation or that participate in the new voluntary demand-reduction trade program move up the interconnection line, and PJM’s Large Load/Peak Shaving Adjustment credits can offset a customer’s share of capacity costs. Track the drafting fights across the four reprints (1R, 3R, 4R) and you can see the definitional fight get sharper each round — “data center” swapped out for “customer” and back, and capacity value redefined against PJM’s own accredited effective load carrying capability metric rather than a bespoke state definition. Existing data centers approved before enactment get a partial carve-out from the guarantee and deposit rules but not from cost-causation or curtailment.
No dollar figures are attached in the statute itself — this sets the framework; the actual rate design happens in BPU dockets to follow, which is where the fight over numbers moves next.
edited and authored by Dave with close collaboration by Claude