Texas SB 6 Large Load Rules: What Data Centers Must Know About ERCOT Interconnection, Curtailment, and Ride-Through in 2026

Why SB 6 matters for every large load in Texas right now

On September 18, 2026, the Public Utility Commission of Texas (PUCT) adopted final interconnection standards for large loads under Senate Bill 6. Three days later, Governor Abbott directed the Texas Commission on Environmental Quality to suspend data center permits pending grid and water audits. If you are developing, operating, or financing a facility that will draw 75 MW or more from the ERCOT grid, the ground rules changed this month.

The scale explains the urgency. ERCOT's large load queue has been reported at roughly 474 GW, about 90% of it data centers. For comparison, ERCOT's all-time peak demand is 91.1 GW, a record set on July 22, 2026. Regulators are no longer treating large loads as passive customers. They are treating them as grid assets that must be studied, secured, curtailed on command, and engineered to ride through faults.

Most coverage of SB 6 comes from law firms and focuses on fees and contracts. This guide covers those, but it is written from the field side. Every new obligation in SB 6 eventually lands on a relay, a PLC, a telemetry point, or a SCADA screen. That is where projects succeed or stall, and it is where NFM Consulting works every day. For the broader interconnection context, see our ERCOT interconnection guide for AI data centers.

What Texas SB 6 actually requires

SB 6 was signed on June 20, 2025 and took effect immediately. It applies to a "large load": one or more facilities at a single site with 75 MW or more of peak demand, a threshold the PUCT can lower. Rather than set every detail in statute, the law directed the PUCT and ERCOT to write the rules. The PUCT split that work into five rulemaking projects:

The net effect is four new realities for large loads: you pay and post security up front, you are studied in a batch instead of one at a time, you must be curtailable during emergencies, and, if you are a computational load, you must stay online through grid disturbances.

The final interconnection rule: 16 TAC §25.194

The adopted rule is softer than the March 2026 draft, but it still requires serious money before a study begins. It applies to a new interconnection of 75 MW or more, an expansion that pushes a site past 75 MW for the first time, or an addition of 75 MW or more to a site already above that line. The PUCT declined industry carve-outs, so hydrogen, metals, and petroleum facilities are covered alongside data centers.

The process runs in four stages, administered by the interconnecting transmission or distribution service provider (TSP/DSP):

1. Intermediate agreement. Before the study, the customer signs an intermediate agreement, pays a $100,000 study fee, submits officer-attested technical disclosures, and posts security of $50,000 per MW of requested peak demand. The TSP/DSP must contact ERCOT within 60 days to start the study.
2. Standard Large Load Interconnection Agreement (SLLIA). After ERCOT allocates transmission capacity, the customer signs the SLLIA and posts security equal to the greater of $50,000/MW of contracted peak demand or the allocated upgrade costs.
3. Contribution in aid of construction (CIAC). Direct interconnection costs are invoiced to the customer before they are incurred.
4. Energization and security release. At first energization, 20% of the SLLIA security comes back. The remaining 80% is released in 20% steps as the customer meets minimum billing demand milestones.

Key changes from the draft:

• No non-refundable interconnection fee. The proposed $50,000/MW non-refundable fee was dropped. The $50,000/MW refundable security posting remains.
• 24-month grace period. Instead of a six-month trigger per milestone, the utility notifies ERCOT of unused capacity only if the whole energization schedule slips 24 months.
• Clearer withdrawal terms. Withdrawing before the study, or receiving zero MW in the batch study, returns 100% of security, less any amounts owed to the utility. Withdrawing after capacity is allocated forfeits 20% of the security tied to that capacity.

Two details matter for design teams. Security is calculated on gross contracted peak demand, so co-located or backup generation does not reduce it. And the technical disclosures are audited: unsupported data can cost a project its allocated capacity. SB 6 itself requires disclosure of on-site backup generation, and the March draft asked for fuel source, run-hour limits, and ramp time to full output, so your single-line diagrams and controls narratives need to be accurate early.

ERCOT Batch Zero: studied together, allocated by the megawatt

ERCOT no longer studies large loads one project at a time. On June 18, 2026, the PUCT approved PGRR 145 and NPRR 1325, which created the Batch Zero process effective July 11, 2026. ERCOT now studies all qualifying projects together, determines what the transmission system can support, allocates megawatts to each project, and builds one transmission plan for the whole batch. See our guide to the ERCOT large load interconnection study for how the engineering analysis fits this process.

Batch Zero also opened new pathways. Loads can build on-site generation to self-supply some or all of their power, loads that agree to let ERCOT curtail them for local transmission constraints get their own connection pathway, and co-located loads can elect a private-use-network pathway. Special-pathway elections and required technical submissions were due July 10, 2026 (utility packages followed on July 24). Projects that remain in Batch Zero without a special pathway are studied as "studied load" and can operate only up to their allocated capacity; projects that miss eligibility can be classified as excluded and wait for a later batch.

The schedule has already moved. On August 3, 2026, the Governor ordered a verification audit of every data center in the process, covering grid and water use, on-site generation, and ownership. ERCOT now expects to finish that audit around December 10, 2026, then resume the study. Published targets had the study report on April 9, 2027, a 30-day window to sign interconnection agreements after that, and Batch 1 applications opening in summer 2027. Expect those dates to slide.

For operators, the practical point is simple. Your allocated megawatts, your curtailment pathway, and your dynamic models are now contract terms. Your controls must be able to prove you stay inside them.

Firm load shed: the remote disconnect requirement

Any transmission-voltage large load interconnected after December 31, 2025 must be curtailable during ERCOT firm load shed. SB 6 (PURA §39.170) requires the serving utility to develop a curtailment protocol, including installing the needed equipment or technology before the customer is interconnected. Critical load industrial customers and designated critical natural gas facilities are exempt. The utility must coordinate with the customer where feasible so load is shed in an orderly way.

This is separate from, and in addition to, a second SB 6 tool. During an energy emergency, ERCOT can direct large loads with backup generation to either deploy that generation or reduce load, after market-based services are exhausted. In July 2026, the PUCT's first SB 6 net metering case (Docket 59220) confirmed that emergency curtailment of a co-located data center is not capped at the size of its paired generator.

In engineering terms, "curtailable" means a verified control path, not a policy document:

• A defined trip or shed point. Usually a breaker at the service delivery point or feeder level, with a protective relay or RTU that accepts the utility's command.
• Reliable communications. A hardened path from the utility's control center to the site, often over DNP3 or IEC 61850, with a fallback.
• Staged, coordinated shedding. Site logic that drops non-critical IT and cooling blocks in a known order, protects life-safety loads, and records what happened.
• Testing and evidence. Commissioning records that show the command works end to end, repeated on a schedule.

The same control path is what makes a site eligible for voluntary programs. A load that can shed precisely on command can also earn revenue from ERCOT demand response when the new SB 6 reliability service is finalized. One exception: co-located loads approved under the SB 6 net metering rule can be barred from demand response and ancillary service programs as a condition of approval. See our demand response and curtailment options for Texas data centers and our ERCOT demand response integration services.

NOGRR 282: data centers must now ride through grid faults

On July 9, 2026, the PUCT voted 5-0 to approve NOGRR 282 and NPRR 1308, widely described as the first ride-through standard for loads in North America. Generators have long had to stay online through voltage and frequency disturbances. Loads were assumed to be passive. ERCOT data changed that assumption: it has recorded 28 events since January 2023 in which large computational loads dropped at least 100 MW during grid excursions, even when protection operated correctly.

The rule applies to a Large Electronic Load, also called a large computational load: a 75 MW-plus site where at least half the demand is power-electronic computing, such as data centers and crypto mining. The rule took effect August 1, 2026. Trade press reports it reaches sites that received ERCOT approval on or after November 15, 2025, with limited carve-outs for projects already through interconnection studies, so confirm your project's status with ERCOT. The rule adds frequency ride-through to Nodal Operating Guide §2.6.4 and voltage ride-through to §2.14, measured at the service delivery point (or the point of interconnection when co-located with generation).

What this means inside the fence:

• UPS and transfer settings. Undervoltage and frequency trip points that were tuned to protect IT gear may now violate the envelope. Many sites transfer to UPS or generators at the first sag. That behavior is exactly what ERCOT wants to stop. See data center backup power and generation controls.
• Protection coordination. Relay settings on mains, tie breakers, and generator paralleling gear must be reviewed against the envelope.
• Models and validation. Dynamic models submitted to ERCOT must match real equipment behavior, and a ride-through failure starts a clock: 90 days to investigate, 90 days to submit a corrective plan, and 180 days to implement it. ERCOT can order disconnection if the risk is imminent.
• Cost. Reported compliance costs run $500,000 to $1 million per MW at some facilities, and one industry group put battery-based mitigation above $1.6 million per MW.

Outside the required envelope, tripping is allowed but not mandated. The rule does not force a site to transfer to backup for conditions beyond the defined ranges.

The Governor's permit pause and what it changes

On September 21, 2026, Governor Abbott directed TCEQ to suspend all permits sought by data centers until ERCOT finishes its large load audit and the Texas Water Development Board completes its water impact review. TCEQ owes the Governor a compliance report by October 19, 2026.

To resume permitting, the letter sets six conditions. Sponsors must absorb dedicated grid infrastructure costs, show their operation will not raise residential bills, clear the joint ERCOT and water audits, show they will not consume water local communities need, file electricity and water use reports, and meet local setback ordinances.

The pause also reaches off-grid and islanded projects that would otherwise bypass the interconnection queue, because they still need state permits. Meanwhile, collateral posted to hold a queue position stays in place. For most projects, the pause is a window to get engineering right: metering for the new reporting duties, curtailment logic, ride-through studies, and accurate disclosures. Those are the same items auditors will ask to see.

A controls and telemetry readiness checklist for SB 6

The regulatory steps above share one dependency: a site whose electrical behavior is measured, controllable, and documented. Use this checklist to find gaps before an auditor, utility, or ERCOT study finds them. Related reading: the ERCOT Large Flexible Load topic and the ERCOT QSE Telemetry topic.

1. Confirm your classification. Is the site 75 MW or more at a single site? Is at least 50% of demand power-electronic computing? Check the key dates: ERCOT approval on or after November 15, 2025 for ride-through, and interconnection after December 31, 2025 for firm load shed curtailment.
2. Audit your disclosures against as-built reality. Load ramp schedules, MW and MVAR data, power factor, and backup generation details should match single-lines, nameplates, and controls narratives.
3. Build a revenue-grade metering and data layer. Interval data at the service delivery point, submetering of major load blocks, and historian retention support billing demand milestones, audits, and water and energy reporting.
4. Engineer the curtailment path. Identify shed points, agree on the protocol and command interface with your utility, and document the load-shed sequence in PLC or power management logic.
5. Review ride-through settings end to end. Check UPS input windows, static transfer switch logic, relay pickup and time delays, and generator start logic against the NOGRR 282 envelope.
6. Validate models with field data. Use disturbance recordings and event data to confirm your dynamic models reflect real response.
7. Prepare for demand response. If you plan to monetize flexibility, plan QSE telemetry, ICCP data exchange, and dispatch interfaces early. See ERCOT QSE telemetry and field services.
8. Secure the control path. Any interface that can disconnect hundreds of megawatts is a cyber target. Segment it, log it, and align with NERC CIP practices even where not strictly required.
9. Test and keep evidence. Commission every command path, repeat tests on a schedule, and store results where an auditor can see them.

How NFM Consulting helps large loads meet SB 6

SB 6 compliance is written by lawyers and regulators, but it is proven in the field. NFM Consulting is a San Antonio-based automation, controls, and SCADA firm that has worked in ERCOT markets since 2017. We help data centers, industrial sites, and energy developers turn new rules into working systems:

• Curtailment and load-shed controls that accept utility commands and shed load in a documented, repeatable sequence
• ERCOT QSE telemetry, ICCP, and DNP3 integration for demand response and reliability service participation
• Metering, historian, and SCADA platforms (Ignition, Geo SCADA) that produce audit-ready evidence
• Protection and ride-through setting reviews coordinated with your electrical engineer of record
• Data center automation across BMS, EPMS, and power infrastructure
• Cybersecurity for critical control paths aligned with NERC CIP practices

If your project is in Batch Zero, planning for Batch 1, or operating under the new curtailment rules, request an assessment or call (210) 405-4248.

This article is for general information and is not legal advice. Rules and schedules are changing quickly; confirm current requirements with ERCOT, the PUCT, and your counsel.

Sources

• White & Case: PUCT sets financial commitments for data center interconnection as governor pauses permit approvals (Sept. 25, 2026)
• Utility Dive: Texas PUC adopts softened rules on data center interconnection (Sept. 21, 2026)
• Greenberg Traurig: SB 6 proposed interconnection standards (Mar. 17, 2026)
• ERCOT: PUCT approves Batch Zero process (June 18, 2026)
• ERCOT market notice M-B062326-01: Batch Zero implementation
• Baker Botts: Batch Zero pause and verification process (Aug. 2026)
• White & Case: PUCT affirms curtailment authority over co-located data centers (Aug. 5, 2026)
• K&L Gates: SB 6 update (June 2025)
• Baker Botts: SB 6 impacts to large loads and co-located generation (July 2025)
• ERCOT: NOGRR 282 Large Electronic Load ride-through requirements
• mGrid: Texas orders ERCOT data centers to ride through grid faults
• MLQ: PUCT approves Batch Zero, SB 6 dockets
• EIA: ERCOT hourly peak load set a new record, exceeding 91 GW on July 22 (2026)
• ERCOT: NOGRR 282 status page (approved July 9, 2026; effective Aug. 1, 2026)
• Utility Dive: Texas PUC approves ride-through rules for data centers (July 13, 2026)