FERC said it would act on the large-load docket by June 2026. As of this morning, we're in June 2026. This is The Data Center Daily — and the deadline FERC set for itself is now on the calendar, with state commissioners already building a fence around it. RM26-4-000, NARUC's comments, and a hyperscale capacity count that just reset the denominator. Let's start with the docket. NARUC filed initial comments in RM26-4-000 — the first time a state-regulator group has put jurisdictional concerns on the record in this docket. They lay out where FERC's interstate transmission authority ends and state retail-service law begins. That's the whole game right there. FERC can write whatever it wants for the interstate transmission system — the second a data center plugs into a distribution line, you're back in state retail jurisdiction. NARUC just put that in writing before the rule's even final. That answers the question we've been circling for three episodes — whether the cost-shift guardrails get written before the access rules or alongside them. NARUC hits the state-law wall directly. That's the clearest answer on the record so far. Section 403 is the statutory hook FERC's working from. The interesting part is how narrow NARUC argues that hook actually is. So don't just watch for whether FERC issues a rule this month. Watch how much of the queue problem the rule can legally touch before the rest has to go back to the states. Here's the number to anchor everything against — Synergy's Q3 2025 count puts operational hyperscale facilities at 1,297 globally. Nearly triple 2018, and average facility size is still climbing. Fourfold capacity since 2018 and still going. The Brattle-Alliant baseline defense — Iowa, Wisconsin, large loads pay their way — was built for a much smaller installed base. Every queue number, every PPA, every state bill this week is a numerator over that 1,297 denominator. Say that out loud before anyone quotes one deal like it moves the needle. And the 2030 deadline pressure isn't just an ERCOT problem. That growth curve is the whole buildout timeline compressed — everybody's racing for the same power and transmission window. Norton Rose's water piece reframes the whole co-location strategy around water access — operators siting where the water is. Same confidentiality problem we hit on power: nobody's required to disclose water-draw terms before they site. And it lands differently now. Lake Anna had a DEQ hearing, Ohio's omnibus bill folded in water use and testing. The legal infrastructure for water constraints is getting built in parallel with the power-cost fight — its own second front. The Federal Energy Regulatory Commission is tracking this. Update on the federal cost-allocation fight we've been on all week: FERC's large-load docket — RM26-4-000 — has a June 2026 action marker. That's this month. The clock we kept pointing to is on the wall. Finally a docket number and a deadline in the same sentence. So I'll stop asking whether FERC acts and start asking what FERC can actually touch. Right — the statutory hook is the interstate transmission system. The moment a data center plugs into a distribution line instead, you're back in state retail-service territory. And that's the wall. NARUC's already filed comments drawing that boundary themselves — state commissioners fencing off their jurisdiction before FERC even finalizes the rule. We'll get into their brief later, but the fence is up. Here's National Association of Regulatory Utility Commissioners:
NARUC appreciates the ANOPR disclaiming any intention to assert jurisdiction over distribution interconnections, generation facilities, and retail sales. It is imperative that FERC, in any final rulemaking, make clear that it is affirmatively not asserting jurisdiction over these facilities, or end-use sales which fall squarely within the exclusive jurisdiction of state energy regulatory authorities.
So we just hit FERC's June deadline on RM26-4-000 — and now the first substantive pushback in the docket is on the record. NARUC filed initial comments, and they're not arguing cost numbers. They're drawing the jurisdictional line. And it's a polite filing — they thank FERC for disclaiming jurisdiction over distribution, generation, and retail sales. Then they spend the rest of it saying: now put that in writing, affirmatively, in the final rule. Right, because a disclaimer in an ANOPR isn't a disclaimer in a final rule. The commissioners know the moment a data center plugs into a distribution line instead of interstate transmission, FERC's hook is gone — and they want that wall named before the pen moves. These are the state regulators building the fence themselves, in writing, before FERC finalizes anything. The same states writing their own cost-allocation rules all week just showed up in the federal docket to make sure the federal rule doesn't swallow retail-service authority. And that's the cleanest answer on the record yet to the sequence question we've been chewing on — do the cost-shift guardrails get written ahead of the access rule, or alongside it. NARUC's saying: the access rule stops at the state-law wall, full stop. So before anyone celebrates a rulemaking, the live question is what FERC can actually touch. Interstate transmission interconnection — yes. Retail contracting, who eats the generation cost — that goes straight back to the states the second the load goes distribution-level. DOE using Section 403 to push FERC toward a large-load interconnection rule is an unusual move — so what's the statutory lever here, and does FERC actually have the jurisdiction to fix the queue problem, or does it hit a state-law wall pretty fast? The hook is FPA Section 403. It lets the Energy Secretary direct FERC to start a rulemaking — a real mandate, not just a request — though FERC still controls the substance and timing. DOE issued that directive on October 23rd, 2025, per the White & Case and Bradley analyses, and asked FERC to act by April 30th of this year. FERC then said in its April 16th order, docket RM26-4-000, that it would act by the end of June 2026 — about two months after DOE's deadline. Snell & Wilmer read that as the commission buying time for a rule that's legally durable, not just fast. The lane here is interstate transmission: wholesale transmission tariffs, RTO and ISO interconnection-queue procedures, cost allocation. That's real. Standardizing how very large loads get studied, queued, and priced at the transmission level could materially compress timelines. But the hard wall, flagged in Utility Dive's November 2025 coverage of the DOE proposal, is retail service. FERC has never regulated distribution-level interconnection, load-service agreements between a utility and a large customer, or site-specific siting decisions. Those live with state PUCs and with vertically integrated utilities outside RTO footprints. So for a significant share of the data-center pipeline — especially in the Southeast and parts of the West, where IOUs serve retail load directly — the federal rule only reaches part of the problem. So are states actually moving to fill that gap, or is this the kind of jurisdictional no-man's-land where nothing happens because everyone assumes the other level of government will act? Commissioner Christie's April 9th piece makes that argument explicitly: states are already building large-load frameworks, and the federal-state boundary is an active division of labor to watch. The practical tell is what the June FERC action looks like — a full NOPR with proposed tariff standards, or something softer, like a policy statement. Then watch whether state PUCs in high-demand corridors coordinate their retail-side rules around it. If they don't, you could get a cleaner federal transmission rule sitting on top of a patchwork of utility-by-utility interconnection side deals that still gate the actual megawatts. From Synergy Research Group:
New Q3 data from Synergy Research Group shows that the number of large data centers operated by hyperscale providers has climbed to 1,297 worldwide, nearly tripling since early 2018. Over the same period, total operational capacity has increased more than fourfold as average data center size continues to rise.
Synergy's Q3 number is the denominator I keep coming back to — 1,297 operational hyperscale data centers worldwide, nearly triple the 2018 count, with average facility size still climbing. And the capex tracks it almost one-to-one: $142 billion in a single quarter, up roughly 180% in three years, against a 170% jump in operational capacity added each quarter. The money and the megawatts are moving in lockstep. Fourfold capacity growth since 2018 and still climbing. Now put that next to the FERC docket we just hit — the interconnection rule that's supposed to land this month is being written against a load curve that doubled while everyone argued about jurisdiction. And the U.S. share went up, not down — from 52 to 55 percent. So all that capacity is concentrating here, on our grid, with our ratepayers. Somebody's distribution line eats that. That concentration cuts against the geographic-diversification story people were telling two years ago. The buildout kept piling into the U.S. instead of spreading out. Here's Rachel Rosenfeld; Scott Burton; Kayce Kasten Borders at Project Finance NewsWire:
Complex computing requires large amounts of cooling water. Data centers get their water primarily from municipal or regional water utility companies. On average, alternative water sources contribute less than 5% of water used by the typical data center.
Norton Rose's number is the one nobody's siting language wants to say out loud — alternative sources, groundwater, recycled water, rainwater, all of it, less than 5% of what a typical data center actually draws. So the other 95% comes from the municipal water utility. The same ratepayers we spent all morning fighting about on the power side are now on the hook for the water too. And the strategy the piece lays out is co-location near wastewater treatment plants — put the load where the water already is. Read that against the Synergy count we hit earlier: 1,297 operational hyperscale facilities, fourfold capacity since 2018, average size still climbing. So the denominator's growing and the recycled-water share is stuck under five percent. Those two lines are heading opposite directions. And here's the part that ties back to FERC — the water-draw terms in these co-location deals are contracted under NDA. A locality approves siting before it gets to see how many million gallons a day this thing pulls. This is the second front. The power-cost fight got a docket number this month at FERC; water's building its own legal scaffolding in parallel, between the Lake Anna hearing and Ohio's omnibus water-testing provisions. It belongs beside the power story. If The Data Center Daily helps you stay ahead, take a moment to subscribe and leave a review wherever you're listening. It really helps other people find the show, and it keeps us bringing you the updates that matter.
We've put links to all of today's stories in the show notes, so if something caught your ear, you can follow it back to the source and spend a little more time with it.
That's The Data Center Daily for this Sunday, June 14th. Thanks for listening. This is a Lantern Podcast.