North America’s grid reliability watchdog on Monday issued its most urgent warning about the risks data centers pose to the power system, setting the stage for greater regulation of the industry.
The rare Level 3 alert by the North American Electric Reliability Corp., or NERC, comes after several incidents in 2024 and 2025, where more than a gigawatt of data center computational load unexpectedly disconnected from the grid at once, raising concerns about blackouts. In April, NERC said it had analyzed numerous load-loss events across the East Coast and Texas that weren’t predicted by planning studies. These “customer-initiated large load reductions” occurred in seconds, leaving little or no room for real-time responses — and jeopardizing the grid’s stability as a result.
Now, NERC is calling for a major regulatory shift to address those blind spots among utilities, grid operators, and data center owners. The organization plans to register companies with computational loads of at least 20 megawatts — such as Amazon, Google, and Meta —- and, eventually, subject them to reliability standards similar to those for power plants.
For example, data centers currently aren’t required to ride through minor grid disturbances, such as a local lightning strike or a line fault. When a huge amount of load drops off at once, it stresses grid infrastructure like transformers and generators.
That risk is growing as hyperscalers plan to connect gigawatt-scale data centers in the coming years, which could rival the power consumption of mid-size U.S. cities. Demand from U.S. data centers could reach 106 gigawatts by 2035, according to BloombergNEF, although developers are facing delays due to grid congestion and rising local opposition.
NERC’s reliability standards won’t become mandatory until they’re approved by FERC. But in the interim, the Level 3 alert signals to RTOs, ISOs, utilities, and other grid operators to begin implementing seven “essential” actions. These include collecting more data on large computational loads and modeling the impacts of minor grid events, as well as installing high-speed monitoring devices at certain data centers to enable analysis of any grid disturbances.
Grid planners are asked to respond to the essential actions by August 3, three months from now.
NERC also published non-binding risk mitigation guidelines for large loads for utilities, grid operators, equipment manufacturers, and data center companies, which the watchdog called “a bridge” to when NERC formally updates its reliability standards for computational loads.
“The goal is to ensure that as more industrial-scale consumers connect to the grid, they actively participate in practices that protect grid stability,” NERC said in a statement. “These steps highlight that proactive planning and participation can enable even more of these facilities to come online reliably and quickly.”
