Thursday, June 25, 2026

The PUC Just Made Your Interconnection Agreement the Only Thing That Matters

ERCOT just turned the interconnection queue into a credibility test, sorting executed projects to the front while 65 GW of speculative applications wait behind them. Developers who lock power procurement and signed commitments first move through the new study line; the rest discover that a queue position isn't a project.

Today's Lead

ERCOT now runs the queue. The Public Utility Commission of Texas approved ERCOT's Batch Zero framework, a one-time systemwide study that consolidates evaluation of new large loads of 75 MW or more, replacing the utility-by-utility reviews that buckled under AI demand. The numbers force the move: roughly 35 GW qualifies as committed Base Load, with another 65 GW running through Batch Zero, a combined volume that exceeds ERCOT's historical peak of about 85 GW.

What changed for developers is sequencing. Batch Zero ties load energization to ERCOT's Regional Planning Group process and to transmission timelines that run years. Projects with executed interconnection agreements, transformer and breaker purchase orders, and site prep underway energize first. Everyone else waits for a future study cycle.

[1]

Power

The grid is full, so the smart money builds around it.

Microsoft drew the blueprint in Reeves County. A 20-year, 2.67 GW power purchase agreement with Chevron will build a dedicated gas plant for a 2GW Pecos campus, running behind the meter and bypassing ERCOT's interconnection queue, which sits past 300 GW of pending applications. Chevron's subsidiary Energy Forge One won Texas Comptroller approval in January for a tax break that could net more than $227 million over 10 years, and the Reeves County school board has advanced the abatement. First power targets 2028, contingent on a final investment decision by year-end.

The economics are tight enough that Chevron told the state the project wouldn't pencil without incentives. Behind-the-meter generation brings its own engineering bill: NFPA 850 elevates from recommended practice to enforceable standard in its 2026 edition, and co-locating LNG storage with compute creates fire risk the parallel-track codes weren't built for. Developers who treat generation and compute as one integrated risk profile clear the 2026 transition. The ones running two separate compliance silos buy themselves redesigns.

[2]·[3]·[4]·[5]

Water

Texas lawmakers want the gallons counted, and the surveys came back nearly empty.

The House Natural Resources Committee spent nearly 10 hours Tuesday on a single gap: only 17% of data centers completed the Texas Water Development Board's mandatory water survey, and the PUC's optional industrial survey drew just 8%. Chairman Cody Harris named Diode Ventures and Calypso LLC as declining to testify. Google, AWS, and Vantage showed up and reported offsets, recycled water, and closed-loop systems. A second gap surfaced too: facilities in counties without groundwater conservation districts, including Falls, Limestone, Hamilton, Mills, and Williamson, can withdraw groundwater without local permitting.

Microsoft's Mount Pleasant campus in Wisconsin shows the engineering answer, running without water consumption more than 90% of the year on dry cooling paired with direct liquid cooling at the GPU level. The signal out of Bell County, with the chamber eyeing the 2027 session, is unambiguous: voluntary accounting is closing, and developers who document offsets before county discussions write themselves into the rules rather than around them.

[6]·[7]·[8]

Sources we cited

8 articles across 6 publishers · 293 reviewed today

[1]Datacenter Knowledge
Texas Approves ‘Batch Zero’ Study as Data Center Demand Soars
Jun 24, 2026·ERCOT’s Batch Zero framework centralizes grid reviews, streamlining large-load approvals to meet soaring AI and data center power demands. …
[2]Data Center Dynamics
Microsoft plans 2GW data center campus in Pecos, Texas
Jun 22, 2026·Chevron signed on for energy supply deal Microsoft has revealed plans for a 2GW data center campus. The company has also inked an energy s…
[3]MarketBeat
Chevron’s Microsoft Deal Turns Natural Gas Into an AI Trade
Jun 24, 2026·Generative artificial intelligence (AI) requires an unfathomable amount of electricity. While retail and institutional investors fiercely ch…
[4]Baltimore Sun
Chevron to fuel massive Microsoft data center in West Texas with natural gas
Jun 23, 2026·Chevron Corp. has signed a 20-year agreement with Microsoft to develop a power facility dedicated to a future data center in West Texas, cre…
[5]Datacenter Knowledge
Powering Behind-The-Meter Power: Where LNG and Process Safety Meet Digital Resilience
Jun 24, 2026·Insight and analysis on the data center space from industry thought leaders. As LNG becomes critical infrastructure for data center resilie…
[6]Texas Scorecard
Texas House Committee Probes Data Centers Strain on Water
Jun 24, 2026·House lawmakers questioned state agencies and tech giants over the consumption of natural resources by data centers. Data center constructi…
[7]KCENTV
Texas lawmakers push for more data, transparency after hearing on data center regulation
Jun 25, 2026·To stream 6 News on your phone, you need the 6 News app. Example video title will go here for this video Example video title will go here …
[8]Datacenter Knowledge
Microsoft’s Wisconsin AI Data Center Campus Now Fully Operational
Jun 24, 2026·The Mount Pleasant campus offers a glimpse of how hyperscalers are turning multibillion-dollar AI infrastructure plans into operational capa…

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