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Behind-The-Meter
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Behind-The-Meter

Onsite data centre power bypassing the grid meter; now taxed by Virginia and curtailed by DOE.

Last refreshed: 28 June 2026 · Appears in 1 active topic

Key Question

Does behind-the-meter generation help data centres avoid climate accountability as well as grid queues?

Timeline for behind-the-meter

#822 Jun

Virginia taxes power behind the meter

Data Centres: Boom and Backlash
#11 Mar

xAI wins 41 gas turbines for Colossus

Data Centres: Boom and Backlash
#11 Dec

GE Vernova gas backlog hits 80 GW into 2029

Data Centres: Boom and Backlash
View full timeline →
Common Questions
What is behind-the-meter generation for data centres?
behind-the-meter generation means a data centre generates its own power onsite, without drawing from the utility grid. It bypasses grid-connection queues and is not subject to grid connection regulations, but requires its own generation permits.Source: Lowdown data-centres briefing
How big are behind-the-meter data centre installations?
The largest behind-the-meter data centre installation is xAI's Colossus in Memphis at 1.2 GW (41 gas turbines). Meta's El Paso facility uses 366 MW BTM. Pure DC's Dublin microgrid is 110 MW. GE Vernova's 80 GW turbine backlog is driven primarily by BTM orders.Source: Lowdown data-centres briefing
What is behind-the-meter power generation for data centres?
behind-the-meter generation is electricity produced on the customer's side of the utility meter and consumed on-site without flowing through the grid. Data centres use it to bypass interconnection queues that can stretch three years or more.

Background

behind-the-meter (BTM) generation refers to electricity generation installed at a facility that feeds power directly to on-site loads without flowing through the public electricity grid or a utility meter. For data centres, BTM has become the primary strategy for bypassing grid-connection queues that stretch to three years or more in constrained markets.

BTM data centre deployments range from natural gas turbines (xAI Colossus, 1.2 GW; Meta El Paso, 366 MW) to renewable microgrids (Pure DC Dublin, 110 MW). The common characteristic is that none of the power passes through a utility connection point, avoiding queue wait times and grid-related regulatory requirements.

BTM is distinct from grid-connected backup generation: in BTM architecture, onsite capacity is the primary power source, not a fallback. Virginia passed a $0.011 per kWh consumption tax on 22 June 2026 covering both utility-supplied and self-generated BTM power, capped at $600m per year and sunsetting 1 July 2028, the first US levy to reach past the utility meter. The Department of Energy separately issued two Section 202(c) curtailment orders against BTM generation in PJM territory in 2026, confirming federal oversight of the sector is active and expanding.

More questions
Why did Virginia pass a tax on behind-the-meter data centre power?
Virginia passed a $0.011 per kWh consumption tax on 22 June 2026 covering both utility-supplied and behind-the-meter power, capped at $600m per year and sunsetting in 2028, as part of a budget deal that preserved the existing $1.9bn sales-tax exemption.Source: Virginia General Assembly
How does behind-the-meter generation let data centres avoid the grid queue?
By generating all primary power on-site, a data centre never applies for a grid interconnection offer, bypassing queues that in some US markets stretch to 2027 or beyond. The facility still needs air-quality or generation permits, but not a utility connection study.
What did the DOE Section 202 curtailment order mean for data centres?
The Department of Energy issued two Section 202(c) emergency curtailment orders in 2026 granting PJM authority to reduce output from data centres with behind-the-meter backup generation during peak-demand events, establishing federal oversight over BTM capacity for the first time.Source: US Department of Energy
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