The Federal Energy Regulatory Commission (FERC) has approved new large-load transmission tariff measures proposed by Duke Energy Carolinas, though the 4-1 vote on Friday, 9 October 2026, showed how divided the commission is on whether the protections go far enough. Even as it signed off, FERC urged Duke, and other transmission owners, to do more to keep data centres and other large users from pushing costs onto existing customers.
What FERC Approved?
Duke Energy Carolinas, which serves about 3 million retail customers in the Carolinas, asked FERC on 29 May to revise its standard network integration transmission service agreement to add rules specific to large loads. The approved package includes:
- Committed revenue contribution: New or transferred large loads must pay an amount equal to 75 per cent of the megawatt value in their load schedule, for each applicable month and year, over 15 years after the required network upgrades enter service.
- Upgrade payments: A transmission customer that needs network upgrades to serve a new load pays a monthly charge to cover the construction cost. Once the upgrades are in service, Duke reimburses the customer, with interest.
- Rate treatment and financial security: Rules covering these items for upgrades driven by large loads.
- Shortfall payments: These apply to loads of 100 MW or larger.
FERC’s Own Warning to Duke
The commission did not treat the approval as the final word. It encouraged Duke to consider individual network integration agreements that offer stronger protection against cost shifting than the standard agreement does, or to propose further consumer protections on top of the approved one.
FERC also told transmission providers, Duke included, to keep reviewing their study processes and service agreements. The goals are to keep the cost of required network upgrades down and to shield other customers as new technologies and load growth patterns emerge.
Three Commissioners, Three Views
Commissioner David Rosner voted yes, calling the proposal a source of “meaningful, if imperfect” new protections. He noted that Duke’s earlier rules had no cost-shift protection for residential or small business customers. He also said consumer protections are inadequate across the country, and that if state regulators fall short, FERC has an obligation to consider widening the cost recovery framework set out in its Large Load Show Cause Orders.
Commissioner Lindsay See also concurred. She described the case as one of the most pressing cost allocation questions the commission faces: making sure large loads pay their way, and that households and small businesses are not left with stranded costs if a large load never arrives, takes less power than expected or leaves early. She called the proposal imperfect but better than the status quo, which left existing customers fully exposed. In her view, it would have been stronger if customers serving large loads had to post financial security at a scale suited to such loads, so other ratepayers would not pay for upgrades if that customer went bankrupt.
Commissioner Judy Chang was the lone dissent. She argued that FERC should have given Duke guidance on improving the proposal instead of approving it. In her view, it lacks meaningful financial security requirements and enough transparency around signed large-load agreements. She also objected that it defaults to rolled-in rate treatment for large-load network upgrades, which may not adequately protect other customers. She said the precedent steps back from the stronger arguments in the show cause orders.
The Bigger Picture
The decision lands while FERC waits for proposals from regional transmission organisations (RTOs) and independent system operators (ISOs) on improving how they connect large loads such as data centres. Those filings are due next month and stem from show cause orders FERC issued in June, which found that RTO and ISO large-load interconnection rules appear inadequate, including on protecting existing customers from cost shifts.
Those orders do not apply to Duke Energy Carolinas or other transmission owners outside RTOs and ISOs, which is why the Duke case matters as a separate test.
Why It Matters?
Data centre growth is raising an old regulatory question in a new form: who pays when the grid has to be rebuilt for a single, very large customer. The split among commissioners suggests FERC will keep revisiting the answer, and the RTO and ISO filings due next month are likely to show how far it is willing to go.
