Governor Greg Abbott signed Senate Bill 6 on June 20, 2025, and it took effect immediately. A month on, the Public Utility Commission has opened its implementation project. It is the most detailed state law yet on how very large electricity customers, data centers above all, should connect to and behave on the grid. It arrives as ERCOT's queue of large loads seeking interconnection has grown to about 156,000 MW as of June 2, up from about 63,000 MW in December 2024, according to the grid operator's monthly operational overview. That is a near-tripling in six months on a system whose all-time peak is about 85,500 MW.
The law does not slow data center growth by decree. What it does is make large loads show more of their hand, pay something up front, and accept that in a grid emergency they will be expected to step back before households do.
Who is covered
SB 6 directs the Public Utility Commission of Texas to adopt standards for customers requesting a new or expanded interconnection where the total load at a single site would exceed a demand threshold. The commission must set that threshold at 75 MW unless it decides a lower one is needed. That is the same size ERCOT already uses to define large loads, and it captures nearly every hyperscale and AI campus, along with large crypto mines and some industrial sites.
Disclosure and fees
The first set of requirements is aimed at the queue itself. A large load customer must disclose to its interconnecting utility whether it is pursuing a substantially similar request for electric service elsewhere in Texas whose approval would lead it to materially change, delay or withdraw the request. The disclosure may anonymize competitively sensitive details. The point is to give utilities and ERCOT a way to discount duplicate requests, which inflate the queue when a single developer files for several sites to see which one moves fastest.
The second is money. The standards must set a flat study fee of at least $100,000 for initial transmission screening studies, paid to the interconnecting utility. A customer that asks for more capacity after the screening study must pay an additional fee. One hundred thousand dollars is trivial next to the cost of a data center, but it is not trivial across dozens of speculative filings. It also funds study work that utilities had been absorbing as requests multiplied.
The emergency provisions
The provisions that drew the most attention concern grid emergencies. SB 6 directs ERCOT to develop a reliability service that competitively procures demand reductions from large loads of at least 75 MW, to be deployed when an emergency is anticipated. ERCOT must give participants at least 24 hours' notice, and participating loads must stay curtailed for the duration of the energy emergency alert or until they can be safely recalled. Loads that already curtail in response to wholesale prices, or that participate in another reliability or ancillary service, cannot offer the same megawatts. The aim is to buy new, firm demand reduction rather than to pay again for flexibility that already exists.
There is also a more direct power. For new or expanded large loads with on-site backup generation that cannot export to the grid and can serve at least half of the facility's demand, ERCOT may direct the facility to reduce its consumption from the grid or switch to its backup generation. That authority applies only before or during a grid emergency and only after ERCOT has exhausted available market services, except frequency response. Data centers already install large fleets of backup generators to meet uptime commitments to their customers. SB 6 turns some of that equipment into a grid resource for the worst hours.
Why Texas moved first
Texas has three features that make large loads a sharper problem than elsewhere. ERCOT is an energy-only market, without a capacity market that procures reserves years ahead, so reliability depends on scarcity pricing and on loads that reduce consumption when prices spike. ERCOT is largely isolated from neighboring grids, so it cannot import much power in an emergency. And the memory of Winter Storm Uri in February 2021, when rotating outages left millions without power, still shapes every reliability debate in the state.
ERCOT's own data show how fast the load is arriving. The June 2025 monthly overview reports that of the 6,874 MW of large loads that had received approval to energize, ERCOT observed a non-simultaneous peak consumption of 3,605 MW in June, up slightly from May. ERCOT has reviewed and approved studies for over 18,000 MW of large loads in the past two years, of which about a third had received approval to energize. The pipeline behind that is an order of magnitude larger.
Ride-through and models
SB 6 is not the only tool. ERCOT issued a market notice in June asking data center and crypto mining loads of 75 MW or more to complete a survey of their voltage ride-through capabilities and to update their dynamic models where needed, with responses due by August 31. ERCOT calls these facilities Large Electronic Loads. The concern is that clusters of such loads can disconnect simultaneously during a transmission fault, as happened with about 1,500 MW of data center load in Virginia in July 2024. Knowing how each facility behaves is a precondition for connecting many more of them safely.
What comes next
Most of SB 6 depends on rulemaking. The commission must turn the statute into standards for disclosure, fees, interconnection requirements, the demand reduction service and the emergency directive. The details will decide how much the law changes behavior. A demand reduction service with attractive payments could draw substantial participation from data centers that can shift computing work. Weak disclosure rules could leave the queue as inflated as before.
For data center developers, the message is that Texas still wants their business but now expects them to carry more of the risk they create. That is a bargain most of the industry can accept, given that the alternative in other states has been moratoriums or open-ended uncertainty about when service will be available.