ERCOT now has roughly 445 gigawatts of large loads asking to connect to the Texas grid, a figure so large that Joshua Rhodes says it might as well be infinite, because the system cannot physically build for all of it.

To sort real projects from speculative ones, ERCOT is launching a new screening process called batch zero, and stakeholders voted to advance it at last week’s Technical Advisory Committee meeting. On this episode, Rhodes walks through the mechanics with Tiffany Wu, an energy markets and regulatory consultant at McAdams Energy Group and a former adviser to Public Utility Commissioner Will McAdams.

The mechanism traces back to SB6, the 2025 law that standardized how large loads connect to the grid and set a 75-megawatt threshold for what counts as a large load. Wu describes a sequence built to thin the field at each step. ERCOT screens which projects qualify and studies what transmission they would require, then puts the survivors through a financial gate that filters out developers unwilling to commit real capital before final studies on whatever clears. The first batch is not expected to finish until late 2027.

Running alongside the batch process is a fight over who pays for the transmission. PUC staff want to charge large loads based on their contracted peak capacity rather than the four coincident peaks that currently let flexible customers shave their bills. Wu says this shift would make much of the demand-response incentive evaporate.

The episode explores:

* How ERCOT separates base load projects already in the queue from those still being studied and allocated.

* Why the shift from 4CP to a contracted-capacity charge changes who pays for transmission.

* How loads can use ERCOT pathways to pull more power than their allocation while transmission gets built.

ERCOT is moving to approve the framework now and tweak it as the first batch works through. (It’s the same build-it-in-motion approach ERCOT CEO Pablo Vegas described on an earlier episode.) The vote sets the rules. The studies will decide who actually connects.

Timestamps

* 00:00 - Introduction & Tiffany Wu

* 01:47 - Why SB6 Exists

* 07:42 - Batch Zero Status

* 10:03 - Who Gets Into Batch Zero

* 16:49 - Financial Obligations and Commitment Gate

* 22:44 - Batch Zero Study and Timeline

* 27:49 - Load Estimates and Flexible Load Options

* 31:37 - Transmission Build-Out and 765 kV Lines

* 35:46 - Batch One and Future Batches

* 37:43 - Transmission Cost Allocation and 4CP Reform

* 46:43 - Reliability Standard Study

Resources

People & Organizations

* Joshua Rhodes (LinkedIn)

* Webber Energy Group (Website - LinkedIn)

* IdeaSmiths (Website - LinkedIn)

* Tiffany Wu

* McAdams Energy Group (Website - LinkedIn)

Company & Industry News

* ERCOT’s TAC Sends Batch Zero Guidelines to Board

Books & Articles Discussed

* Texas Senate Bill 6, 89th Legislature

* PGRR145 - Batch Zero Process for Large Load Interconnections

* PUC Project No. 58481 - Large Load Interconnection Standards Rulemaking

Related Podcasts by Energy Capital

* How Texas Plans to Serve ‘Infinite Demand’ with Eric Goff

* Who Pays for the New Grid with Pablo Vegas

* Is Texas Ready for Winter Now? with Will McAdams

Related Posts by Texas Energy & Power

* Energy Policymakers Grapple with Reliability, Fairness, and Flexibility

Transcript

Joshua Rhodes: Hey everyone, and welcome to another episode of the Energy Capital Podcast. I’m really excited to have Tiffany Wu here to talk more about what all is happening in ERCOT, particularly around SB6, large loads, transmission cost allocation, all of the hot topics right now. Tiffany Wu is an energy markets and regulatory consultant with McAdams Energy Group. And for more background with McAdams Energy Group, you can go back and listen to Matt Boms’s interview with Will McAdams just a couple months ago. So before working at McAdams Energy Group, Tiffany was a DOE Solar Energy Innovation Fellow and also an advisor to Will McAdams while he was a commissioner at the Public Utility Commission of Texas. But between that, also was a senior project manager at TEPRI, the Texas Energy Poverty Research Institute, which is, I think we actually met. We had our first conversation when you were at TEPRI, and I was asking you questions about how these 9.9 megawatt batteries, what they were paying for electricity and how much they got paid for electricity, because that was a big deal for a while.

Tiffany Wu: That’s right. Yeah, I remember that there are a lot of questions around whether or not those batteries which support the grid, whether or not we should be paying for some of those distribution level costs as transmission level costs. Yes.

Joshua Rhodes: Yeah. Anyways, we probably won’t get into that, but we can leave that as a thing. But that was super helpful back then. Thanks. And I know you you also spent 10 years with Mitsubishi Heavy Industries as a process engineer, commissioning engineer. I’m really excited to have another engineer on this podcast. That’s kind of rare, to be honest. Well, thank you. You got your BS and chemical engineering at UT Austin before getting your masters at the LBJ School of Public Affairs. So Tiffany Wu, welcome to the Energy Capital Podcast.

Tiffany Wu: Thank you. Thanks for having me.

Joshua Rhodes: Yeah. So the day we’re recording this podcast, we we just released a podcast with Eric Goff where we talked we hit on some broad topics around how ERCOT policy is made. And we talked a lot about the large load process. I’d encourage folks to kind of maybe listen to that podcast first in terms of like kind of setting the broader goal. But with this one, I think I’d like to get a little bit deeper in this conversation around some of the intricacies of the process, kind of where it’s at. And to be fair, this kind of fits in my teaching philosophy of any time I give a lecture, I try to say the same thing three times in three different ways as a way of like some people learn one way versus the other way. So there will be some overlap between this and and the podcast with Eric, but I still think there’s so much there that I think this is gonna be, I think we need to be having a lot of conversations around this. But we’re gonna get deeper into some of these things. But let’s start bigger picture, maybe for folks who haven’t had the one with Eric. So The whole reason we’re having this conversation about large loads and batch zero and transmission cost allocations based on SB6 or Senate Bill 6. Can you lay out what problems Senate Bill 6 was looking to solve and kind of how the batch zero process, you know, fits into that effort?

Tiffany Wu: Yeah, sure. So Senate Bill 6 is trying to balance a few different things. So previously in ERCOT, most of the large loads were coming from the cryptocurrency industry. It wasn’t until recently that more of the data centers have been looking for interconnection into ERCOT. So historically, the way that you would connect into the system is you would go and talk to your transmission provider or your distribution provider and ask them, hey, I want to set up a business. Can I connect to the electricity system? And they would figure it out. But because there are so many loads coming in now, there was some concern that with the size. Historically they were working on one project at a time and TSPs were conducting the studies, but ERCOT started to see that there may be a reliability issue with how many loads are coming onto the system and how big each of these loads are. The other issue is that with the cryptocurrency miners, you may remember that a lot of people were worried that they were not paying transmission costs because the way that we paid transmission costs historically is based off of the four coincident peaks during the summertime. And so if you’re able to avoid that, then you don’t have to pay t...