Behind-the-meter generation reforms — co-located gen + large load
The Talen-AWS Susquehanna deal is the most important precedent in U.S. BTM co-location law for hyperscale loads. AWS bought the Cumulus data center campus adjacent to Talen's 2.5 GW Susquehanna nuclear plant in March 2024, with a plan to route 960 MW directly to co-located data centers. Talen + PJM filed an amended ISA at FERC as docket EL-24-114 (May 2024) increasing co-located load from 300 to 480 MW initially. FERC REJECTED the amended ISA 3-2 on November 1, 2024 — concerns: cost shifts to non-participating ratepayers, capacity accreditation of BTM-served generation, contingency planning on generator trip. Christie + Phillips dissented. Three co-location models: (1) pure BTM, (2) hybrid (Talen-AWS proposal), (3) separately-metered with dedicated line. Technical core disputes: capacity accreditation (does BTM-served MW count?), cost shift (BTM avoids T&D charges socialized via tariffs). State action: Virginia SCC Order PUR-2024-00045 restricts Dominion-territory co-location >100 MW; Texas PUCT relatively open under §25.494; OH/IN inquiries pending. Hyperscale strategy: jurisdiction selection matters; tolling agreements / bilateral PPAs preferred over full gen ownership to reduce regulatory complexity. PJM December 2024 compliance filing proposed cost-shift testing + capacity-accreditation rules. Framework remains in flux.
Step 1 - Talen-AWS Susquehanna + FERC docket EL24-114 precedent
Reference notes
The Talen-AWS Susquehanna deal is the most important precedent in U.S. behind-the-meter (BTM) co-location law for hyperscale loads. AWS bought the Cumulus campus adjacent to Talen's 2.5 GW Susquehanna nuclear plant in March 2024 with a plan to route 960 MW of nuclear-generated power directly to co-located data centers. The amended ISA was filed at FERC as docket EL-24-114; FERC rejected it 3-2 on November 1, 2024. The framework remains in flux. State commissions (notably Virginia SCC) have taken parallel action. Mastery of this docket and the underlying capacity-accreditation and cost-shift mechanics is essential. Use Next → to walk through the precedent, the three co-location models, the FERC EL24-114 specifics, the technical core disputes, and the state-level developments.
Talen-AWS Susquehanna precedent
- Deal: AWS purchased Cumulus data center campus, March 2024
- Source: Susquehanna Steam Electric Station — 2.5 GW nuclear, Talen Energy-owned, northeastern PA
- Target: 480 MW co-located initially, path to 960 MW
- Docket: FERC EL-24-114 filed by Talen + PJM, May 2024
- FERC Order: November 1, 2024 — REJECTED 3-2
- Aftermath: PJM December 2024 compliance filing; multiple follow-on dockets open through 2025
Three co-location models
| Model | Configuration | Trade-off |
|---|---|---|
| 1. Pure BTM | Gen + load same site, direct connection | Simplest · avoids transmission charges |
| 2. Hybrid | Co-located, separate meters, both grid-connected | Flexibility · separate regulatory treatment |
| 3. Sep-metered | Dedicated line, gen → load, bypass grid | Greatest regulatory scrutiny · nuclear-to-DC typical |
Talen-AWS proposed Configuration 2 — Hybrid — which FERC rejected.
FERC EL24-114: what was filed, what was rejected, why
- Intervenors: AEP + Exelon (protests) · PJM Independent Market Monitor · state consumer advocates
- FERC concern 1: filing did not demonstrate that load avoided unjust cost shifts to non-participating ratepayers
- FERC concern 2: capacity accreditation of BTM-served generation not adequately addressed
- FERC concern 3: contingency planning if generator trips and load suddenly imposes full demand on grid
- Dissent (Christie + Phillips): majority standard overly stringent, would chill desirable co-location investment
- PJM December 2024 compliance filing: proposed framework with explicit cost-shift testing + capacity-accreditation rules
Technical core disputes
- Capacity accreditation: should the BTM-served generation MW count toward capacity? Critics: double-pays the generator. Developers: capacity revenue is essential to economics.
- Cost shift: BTM consumption avoids T&D charges normally socialized via utility tariffs → other ratepayers subsidize BTM portion
- Mitigation proposals:
- Assign hypothetical T&D charge to BTM-served load
- Require contribution toward shared system costs
- Tiered cost allocation based on BTM share size
- PJM Dec 2024 proposal: allocates calculated portion of avoided transmission cost back to co-located load through tariff charge
State-level developments
- Virginia SCC Order PUR-2024-00045 — restricts Dominion-territory co-location arrangements > 100 MW · requires filing with Commission
- Virginia stakes: Loudoun County alone hosts ~70 % of global Internet traffic — AWS / Microsoft / Google / Meta concentration
- Texas PUCT: open to co-location per §25.494 with specific configuration rules · more clarity than PJM today
- Ohio PUCO, Indiana URC: inquiries opened · pending FERC clarity
- MISO footprint: wait-and-see pending FERC clarification
Hyperscale strategy implications
- Jurisdiction selection matters more than ever — ERCOT relatively clear, PJM uncertain, Northeast restrictive
- Multi-jurisdictional flexibility — ability to redirect projects across RTO footprints is now a key strategic asset
- Contracting structures — tolling agreements and bilateral PPAs increasingly preferred over full ownership of co-located generation (avoids some FERC/state complexity)
- Schedule planning — FERC docket activity can produce material changes within a single Order; compliance team must track open dockets weekly
Why it matters for the AWS Grid Code Compliance Manager role
Behind-the-meter co-location is the most cost-effective way to power hyperscale data centers, but the federal + state regulatory framework remains in flux. Multiple AWS deals depend on a workable framework. The compliance team is engaged in shaping the outcome — tracking FERC dockets, monitoring state commission actions, structuring compliant contracts, and forecasting per-MW economic exposure under multiple regulatory outcomes. Material developments can occur on a monthly basis through 2025-2026.