ERCOT's 410 GW Load Queue: What It Means for Your Business Energy Bill

ERCOT's large load interconnection queue has reached 410 GW, roughly five times the grid's current peak capacity of 85 GW. Data centers account for 87% of those requests. The queue doubled in just 10 months, jumping from 169,615 MW in May 2025 to 410,618 MW by March 2026. For commercial electricity buyers who are not building data centers, the question is straightforward: who pays for the grid upgrades all this new demand requires? The answer involves TDU delivery charges, 4CP transmission cost allocation, and a 2025 law (SB 6) that was supposed to protect you.

What Happened: The Queue Explosion

ERCOT's interconnection queue tracks every large load requesting a grid connection. As of April 2026, it holds 410 GW of pending requests. Oncor alone has received 650 requests totaling 273 GW, more than three times the entire ERCOT system's peak demand. The vast majority of these requests come from AI and hyperscale data center operators racing to secure power for new facilities across Texas.

Senate Bill 6, signed in 2025, was designed to address the queue backlog. It shifts ERCOT from a first-come, first-served model to one requiring large loads (over 75 MW) to post proof of financial commitment, site control, and interconnection readiness. The law also mandates that large users cover their own interconnection costs rather than spreading them across all ratepayers. By Q1 2026, SB 6 had cleared roughly 40% of speculative projects from the queue.

Meanwhile, some developers are bypassing the queue entirely. Pacifico Energy secured permits in January 2026 for a 7.65 GW off-grid campus in Pecos County, with first power targeted for Q1 2027. These "power islands" sidestep ERCOT's multi-year approval process by generating their own electricity on-site, signaling a two-tier market forming between grid-connected and off-grid large loads.

How the ERCOT Large Load Queue Affects Commercial Electricity Buyers

SB 6 assigns direct interconnection costs to the large loads that trigger them. That is the good news. The less-discussed reality is that broader transmission upgrades still get socialized through TDU delivery charges, which every commercial ratepayer pays regardless of their REP.

Here is how the cost pressure flows to your business:

• TDU delivery charge increases: When ERCOT approves transmission upgrades to serve new large loads, TDUs like Oncor and CenterPoint recover those costs through delivery charges filed with the PUCT. These charges apply to all commercial customers in that service territory, not just the data centers that prompted the build-out.
• 4CP transmission cost shifting: ERCOT allocates transmission costs based on your usage during the four annual coincident peak hours (4CP). Data centers run 24/7 at flat load, meaning they may not spike during those specific peak hours despite driving the infrastructure need. The result: non-datacenter commercial buyers can end up absorbing a disproportionate share of transmission costs.
• Wholesale price volatility: With ERCOT projecting 21% load growth from 2024 to 2026, wholesale prices face upward pressure during peak periods. Pass-through contract structures expose commercial buyers directly to these spikes.
• An emerging two-tier market: Off-grid projects like Pacifico Energy's Pecos County campus and FO Permian Partners' Midland County facility create a separate power market. If enough large loads leave the grid, the remaining connected customers bear a larger share of fixed transmission costs.

The Non-Datacenter Commercial Buyer's Load Queue Checklist

This seven-step checklist helps commercial electricity buyers assess their exposure to cost shifts from the ERCOT large load queue and take protective action before their next contract renewal.

1. Review your contract for TDU passthrough language. Check whether your current agreement includes specific clauses allowing your REP to pass through TDU delivery charge increases triggered by large load interconnections. If the language is vague or absent, you have a negotiation point at renewal.
2. Ask your REP how they hedge 4CP coincident peak exposure. Specifically, ask whether their 4CP strategy accounts for data center load growth intensifying peak demand. REPs that actively manage 4CP exposure through demand response or curtailment programs can offer more stable pricing.
3. Evaluate fixed all-in rates versus pass-through structures. A fixed rate locks in your total cost per kWh, insulating you from TDU increases and wholesale volatility. A pass-through structure offers lower base rates but exposes you to every cost increase the grid produces.
4. Audit your TDU zone exposure. Oncor's territory carries the heaviest load queue concentration (273 GW of requests). CenterPoint and TNMP territories have lower exposure. If you operate across multiple locations, compare TDU-specific risk profiles.
5. Investigate interruptible service options. Some TDUs offer lower delivery rates for customers willing to curtail during grid emergencies. If your operations can tolerate brief interruptions, this can offset rising baseline delivery charges.
6. Monitor PUCT dockets for rate filings. TDU delivery charge changes go through PUCT review. Tracking dockets like PUCT Project No. 54014 (interconnection reforms) gives you advance notice of cost increases before they hit your bill.
7. Compare rates before renewal. Published commercial rate data shows median pricing by TDU territory. Benchmark your current rate against the market before entering renewal negotiations.

Questions to Ask Your REP or Broker

• Does my contract include TDU delivery charge passthrough language triggered by large load interconnections?
• How does your pricing model hedge 4CP coincident peak exposure, given data center load growth?
• Would a fixed all-in rate or a pass-through structure better protect me from infrastructure cost increases over the next 24 months?
• Which TDU territories in your portfolio have the highest large load queue concentration, and how does that affect my rate?
• Do you offer interruptible service or demand response programs that could lower my delivery charges?

Frequently Asked Questions

What is the ERCOT large load interconnection queue?

The interconnection queue is ERCOT's process for approving new large electricity loads (typically over 75 MW) connecting to the Texas grid. As of April 2026, the queue holds 410 GW of pending requests, with 87% coming from data center operators. For context, ERCOT's current peak demand capacity is approximately 85 GW, so the queue represents nearly five times the grid's existing capacity.

Will SB 6 protect my business from higher electricity costs?

Partially. SB 6 requires large loads to cover their direct interconnection costs rather than socializing them across all ratepayers. However, broader transmission upgrades prompted by large load growth can still flow through TDU delivery charges that every commercial customer pays. SB 6 reduces your exposure to speculative queue projects but does not eliminate all cost-shifting from grid expansion.

What are 4CP charges and why do data centers affect them?

4CP (Four Coincident Peak) charges allocate transmission costs based on your electricity usage during the four highest system-wide demand hours each year. Data centers run at flat, constant load 24/7, so they may not peak during those specific hours despite requiring massive grid infrastructure. This means other commercial buyers can end up paying a larger proportional share of transmission costs relative to the infrastructure burden data centers impose.

Should I lock in a fixed rate now?

If you are in a TDU territory with heavy queue exposure (especially Oncor), locking a fixed all-in rate for 24 to 36 months insulates you from delivery charge increases and wholesale volatility. If your contract is pass-through, you absorb every cost increase as it happens. The tradeoff: fixed rates may carry a premium over current spot pricing, but they provide budget certainty as grid costs rise.