NERC issues Level 3 alert

The North American Electric Reliability Corporation issued a Level 3 Essential Action Alert on May 4 aimed at utilities, planners and operators dealing with fast-growing computational loads, including artificial intelligence training, cryptocurrency mining and traditional data centers. NERC said the alert requires seven actions to address immediate risks to the bulk power system from how those loads are modeled, studied, commissioned, operated, protected and controlled. The organization said it moved to the highest alert level after seeing customer-initiated large load reductions and demand oscillations that can unfold in seconds, leaving little or no time for real-time intervention. ### Why did NERC escalate to a Level 3 alert now? May 4 is the date NERC published both the alert and a companion statement saying the grid is facing “unprecedented challenges” from a surge in large power consumers. In the alert itself, NERC said responses to an earlier Level 2 industry recommendation showed entities “generally did not have sufficient processes, procedures, or methods” to address risks tied to computational loads. (nerc.com) NERC said the problem is not only the size of the new demand but its electrical behavior. The alert cites sudden load drops and significant oscillations, and says those events can threaten reliability because operators may have little or no room to react in real time. ### Which facilities does NERC say are covered? Artificial intelligence training, cryptocurrency mining and traditional data center uses are listed in the alert as examples of computational load. (nerc.com) NERC said the current focus would include loads of 20 megawatts and greater, connected at 60 kilovolts, and containing more than 1 megawatt of IT load. NERC’s Large Loads Action Plan says the Level 3 alert is part of a broader push that also includes draft registry criteria and work on new reliability standards for a proposed “Computational Load Entity.” NERC has said the voluntary guideline released alongside the alert is meant to serve as a bridge while formal standards are developed. (nerc.com) ### What does the Lake Tahoe case show about the pressure on supply? Liberty Utilities told California regulators that it needs a new source for 75% of its power after May 2027 because NV Energy will not continue its supply arrangement, according to CalMatters. (nerc.com) CalMatters reported that Liberty serves about 49,000 customers on the California side of Lake Tahoe. NV Energy has said data centers are driving “unprecedented” demand, according to CalMatters’ reporting and follow-up republications. (nerc.com) SFGATE, citing Liberty’s March 6 letter to the California Public Utilities Commission, reported that Liberty described NV Energy’s decision as a “surprise” requiring “immediate action” in a competitive Nevada market where new data centers are increasing demand beyond existing supply. (calmatters.org) Tahoe Daily Tribune reported that the current arrangement dates to NV Energy’s 2009 sale of electric system assets to Liberty and that NV Energy plans to provide service until the Greenlink Nevada transmission project is completed in spring 2027. That leaves Liberty looking for replacement supply on a fixed timetable. ### What are utilities saying about customer bills? (thenevadaindependent.com) Joe Nolan, Eversource Energy’s chief executive, said on the company’s May 7 earnings call that he is “not interested” in data center development in Eversource territory because it is “only going to drive up the price of energy.” Nolan also said data centers are “of no value to our residential customer — actually, any customer,” according to Utility Dive’s account of the call. (tahoedailytribune.com) Connecticut regulators moved electric rates lower effective May 1, 2026, but PURA said those reductions apply through April 30, 2027 and were tied to approved rate adjustment mechanisms, not to any endorsement of major new data-center load. PURA’s April 22 release said the changes would reduce rates for Eversource and United Illuminating customers in the state. ### What happens next for grid operators and utilities? (utilitydive.com) August 3, 2026 is NERC’s deadline for registered entities to submit responses to the Level 3 alert. NERC said the alert applies to transmission planners, planning coordinators, transmission owners, balancing authorities, reliability coordinators and transmission operators that have or could receive computational loads within two years. (portal.ct.gov) May 2027 is the next hard date in the Tahoe dispute. Liberty Utilities must line up replacement supply before NV Energy’s cutoff takes effect after that month, while NERC continues developing registration criteria and reliability standards for computational loads through its Large Loads Action Plan. (calmatters.org) (nerc.com)