Grid Risk Evaluation Strategy By NERC Outlined, Focusing on Potential Threats from Data Centers
The North American Electric Reliability Corporation (NERC) has embarked on a significant initiative to evaluate the impacts of the rapid expansion of data centers and other large industrial loads on the reliability and security of the U.S. grid. As part of this ongoing effort, NERC has engaged its Electric Gas Working Group (EGWG) to conduct a comprehensive investigation.
In this mission, NERC will release two white papers over the next two years. The first white paper, expected in the second quarter of 2025, will examine the characteristics and risks of emerging large loads. This will be followed by the second white paper, due in the third quarter of 2025, which will assess the gaps in existing practices, requirements, and NERC Reliability Standards for emerging large loads.
To ensure a focused approach, NERC will prioritize risks in three tiers: High, Medium, and Low. The high-risk tier includes critical aspects such as Long-Term Planning Resource Adequacy, Operations/Balancing, Stability, Ride-through, Frequency Stability, Voltage Stability, Oscillations, Resilience, Automatic Underfrequency Load Shedding Programs, and System Restoration. The medium-risk tier includes Long-Term Planning Demand Forecasting, Transmission Adequacy, Operations/Balancing Short-Term Demand Forecasting, Lack of Real-Time Coordination, Resilience Load-Shed Obligation Impacts, Power Quality Harmonics, Voltage Fluctuations, Security Risks Cyber Security, and Resilience System Restoration. The low-risk tier includes Power Quality Voltage Stability.
As part of this endeavour, NERC may explore the need to create new Reliability Standards, or modify existing ones, to sufficiently identify and manage risk to the grid. Stakeholders will have opportunities to engage with FERC, PJM, NERC, and other regulatory entities over the coming months.
In a related development, the Western Electricity Coordinating Council (WECC) has established a Large Load Risk Assessment project. The report from WECC, released in February 2025, emphasizes the importance of large loads meeting BPS performance requirements, including disturbance ride-through. This project underscores the urgency and importance of NERC's white paper series.
NERC has planned a series of events, culminating in the release of these two white papers in the first quarter of 2026. The findings from these white papers are expected to provide valuable insights and guide the evolution of the U.S. grid to accommodate the growing demands of emerging large loads.
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