• Near-term data center projects risk delays if they miss Batch Zero’s initial window.
• Intent is to prioritize commercially mature projects over speculative queue entries
• Key uncertainties remain on cost, prioritization, implementation, and regulatory alignment with PUCT

As ERCOT advances its batch load process for large load interconnection, Seyfarth Shaw partner Christopher Cottrell warns that near-term data center projects will not want to miss the initial window for Batch Zero when it opens later this year.

ERCOT is currently targeting a June 2026 ERCOT board consideration and July 2026 PUCT consideration for a revised version of its Batch Zero framework, which is intended to be a transitional but important first step as the grid operator moves toward future batch processes. While final implementation remains subject to ERCOT stakeholder, board and PUCT processes, ERCOT has indicated 2026 is the target for the development of the broader batch study framework, as well. In that sense, Cottrell tells NPM in an interview, “Batch Zero is best understood as the first iteration of a larger structural shift.”

While other ISOs like PJM and MISO have moved toward clustered study processes, Cottrell notes ERCOT’s proposal is a unique Texas spin. Most notably, it is focused exclusively on large load interconnection but stops short of impacting the wider generator interconnection process for energy projects. So, while Cottrell says the policy objective is “familiar, the ERCOT implementation needs to be evaluated on its own terms.”

Batch Zero as currently underscored by ERCOT, offers a tradeoff for large load customers between speed and certainty vs. cost and commitment. Cottrell says a faster and more transparent process like what may materialize under Batch Zero “has real value, especially for projects with near-term commercial deadlines.” However, he also warns the stricter entry requirements and upfront financial commitments may create too many hurdles for more speculative projects which, as he points out, appears to be a key pillar of process design.

“ERCOT is trying to prioritize projects that are mature enough to justify scarce study resources and transmission planning attention,” Cottrell said. “Although no process will eliminate speculative activity entirely, requiring projects to demonstrate site control, commercial readiness and financial commitment should make the queue more realistic over time.”

At that point, Cottrell says, the key question will become calibration. He argues if the batch study requirements are too loose, the queue will remain inflated, while stricter rules may push out otherwise viable projects. Ultimately, he says the “likely result is a queue that becomes more realistic over time, but not perfectly predictable.”

Practically, Cottrell says Batch Zero may become very important for data center developers seeking near-term interconnection, but he stops short of describing it as a universal requirement considering possible project variations including different utility arrangements, behind-the-meter structures and phased load ramps. However, he warns missing the first organized process “could create a meaningful timing disadvantage.”

NPM data is tracking 34 data centers under construction and 145 planned data centers in Texas.

There remains a lot of clean energy and thermals projects to either support data centers and/or provide grid-scale power that have advanced in a low cost, low regulatory environment as 9.77 GW of solar pre-operational projects, 6.57 GW of pre-operational storage projects and over 10 GW of natural gas projects reached an advance stage since the beginning of 2026, according to NPM Interconnection queue data.

“Developers that are later in the process or that cannot satisfy the readiness requirements, may face longer timelines, higher upgrade costs, additional restudy exposure, or more uncertainty around whether the grid can support their requested load when needed,” Cottrell said.

On the other hand, he says projects that do make it into Batch Zero will likely find value in the early transmission capacity allocation, particularly in a system constrained like ERCOT. He says developers that can demonstrate readiness and secure a spot in Batch Zero may also “gain a clearer view of available capacity, upgrade requirements, timing and cost exposure that can be a major advantage for financing, customer commitments, site acquisition and construction planning.

Cottrell also notes this analysis is based on the current version of Batch Zero which still contains lingering questions regarding implementation and regulatory alignment with the PUCT’s broader large load rulemaking.

Cottrell says key factors like how financial commitment requirements will be applied, how ERCOT and transmission service providers will treat projects that are commercially advanced but don’t fit nearly within gating criteria, how upgrade costs will be identified and allocated, and how projects will be prioritized if available capacity is limited remain open questions.

He also notes local and statewide legislative activity should also be “watched carefully,” though he separates that from the batch process reform as scopes could differ and legislative action could be more focused on data center projects without directly changing the batch process itself.

“The practical near-term impact is that developers may need to manage both grid readiness on the ERCOT side and local development, permitting, political and siting risk on the project development side at the same time,” Cottrell said.