Sarah: The grid’s busiest regions are still writing rules for their biggest customers.
Sarah: New to this? Here’s where things stand.
Sarah: FERC’s June 18 orders put large-load tariffs under show-cause scrutiny across the organized markets. In PJM
Sarah: the reform fight already includes proposals to curtail new 50 MW-plus loads without secured supply ahead of demand-response programs during
Sarah: shortages. It also covers queue reform, ride-through requirements, IRAS, and governance pressure over data-center load and reliability risk.
Matt: This is The Data Center Daily.
Matt: Tariff delays, a would-be 40-gigawatt transformer factory, and a Chicago land grab—everyone’s racing ahead of the rulebook.
Sarah: Amyra Mardhani, writing in Enverus:
Quote: The pipeline of large loads waiting to come online is concentrated in regions that are seeking more time to finalize their tariff
Quote: frameworks. PJM and the MISO account for most of the identified high-confidence large load, but neither has a finished rulebook.
Quote: SPP the only region with FERC-approved large-load tariffs that the commission has pointed to as a model
Quote: has comparatively little identified capacity.
Sarah: On FERC’s large-load tariffs: all six grid operators now want until November, and PJM and MISO face the biggest load exposure.
Sarah: The twist is brutal: SPP has the FERC-approved model tariff, but comparatively little of the high-confidence load that needs it.
Matt: So the crowded regions get a 90-day extension to write rules for customers already lining up at the gate.
Matt: Developers are supposed to price transmission upgrades
Matt: generation and who gets stuck with the bill while PJM and MISO are still editing their tariffs?
Sarah: FERC gave them 60 days after the June 18 orders to amend or defend these tariffs, and said extensions wouldn’t be automatic.
Sarah: They do have a real problem: protecting existing customers while accommodating giant new loads.
Sarah: But every month without terms makes cost allocation and project timing harder to bank.
Matt: And capital has alternatives.
Matt: Enverus points to ERCOT’s Batch Zero because there’s an actual process there.
Matt: November may sound procedural in Washington.
Matt: In an interconnection queue, it’s another season of somebody reserving capacity before anybody’s agreed who pays for it.
Sarah: This one's from Latitude Media:
Quote: The power conversion tech company Heron Power is putting steel in the ground for its first commercial factory
Quote: just miles from its Silicon Valley engineering hub.
Quote: The startup which in February closed a $140 million Series B to fund the build-out
Quote: aims to start production in the second half of 2027 and eventually ramp up to 40 gigawatts of capacity
Quote: or about 10,000 of its “Heron Link” systems.
Matt: Steel’s in the ground at Morgan Hill—that part is real.
Matt: But Heron says production won’t start until the second half of 2027.
Matt: And 40 gigawatts is the eventual ceiling—about 10,000 Heron Links.
Matt: You won’t see anything like that land in an interconnection queue next quarter.
Sarah: Exactly. Latitude’s number matters because it puts real factory math on the transformer workaround.
Sarah: Heron raised $140 million in February
Sarah: is still developing its manufacturing process
Sarah: and doesn’t expect first commercial output before late 2027.
Sarah: It won’t ease the supply crunch anytime soon.
Matt: And we just covered ISOs pushing large-load tariff reform to November.
Matt: We’re still waiting on the rulebook, and the alternative transformer factory is eighteen months out.
Matt: Meanwhile, somebody’s still reserving capacity today.
Matt: Who gets to sit in that queue while everyone else waits?
Sarah: Heron’s California choice makes sense for a first complicated product—Baglino wants engineers close to the factory.
Sarah: Still, this is early industrialization.
Sarah: There isn’t a warehouse full of finished modular transformers waiting for hyperscaler pickup.
Sarah: From The Real Deal:
Quote: Jeff Aeder’s Chicago-based JDI Realty earlier this year bought the $35 million mortgage loan note for about $10 million from Signature Bank
Quote: ahead of its merger with New York-based Esquire Bank
Quote: at a significant discount.
Quote: Buck originally paid $53 million for the site in 2023 but failed to secure an anchor tenant for its planned office towers at 645 West
Quote: Madison Street.
Sarah: Digital Realty is reportedly the mystery buyer behind Hawthorne Race Course, paying $90 million for a Chicago-area site.
Sarah: Land is changing hands before the power rules are settled—especially awkward after PJM and MISO’s filing delay.
Matt: A racetrack is a great place to buy acreage.
Matt: It isn’t a magic portal to energized megawatts, transmission upgrades, water, and a cooperative suburb.
Sarah: The Real Deal also reports that JDI Realty bought John Buck's distressed $35 million note for about $10 million.
Sarah: In Chicago real estate, you can buy discounted debt or expensive optionality.
Matt: Hawthorne may be Bannock County in a sport coat.
Matt: A giant proposed load shows up for local officials, and residents are left with noise and water questions.
Matt: Meanwhile, the developer gets there before the rulebook.
Matt: Digital Realty bought a site; it may have also bought a very public fight.
Host: If The Data Center Daily’s useful, please subscribe and leave a review wherever you’re listening.
Host: It helps more people find the show, and we’re glad you’re here.
Host: We’re watching November—the next tariff checkpoint
Host: if FERC grants all six ISO/RTO extension requests—and Heron Power’s plan to start production at its Morgan Hill factory in the second half
Host: of 2027. You’ll find links to every story in the show notes if you want to dig in.
Host: That’s The Data Center Daily for today.
Host: This is a Lantern Podcast.