CAISO

CAISO (the California Independent System Operator) manages the high-voltage grid serving around 80% of California's electricity load and a small part of Baja California, Mexico, one of six US regional transmission organisations under FERC jurisdiction. It runs the wholesale electricity market and coordinates interconnection studies for the western grid.

California's state air-quality rules restrict certain forms of behind-the-meter generation, which makes CAISO's approach to data-centre co-location structurally different from RTOs that lean on onsite gas turbines to bridge supply gaps. FERC issued CAISO a Section 206 show-cause order on 18 June 2026 requiring it to justify or reform large-load tariffs across co-location terms, study processes and cost allocation, with responses due 17 August 2026 and public comments due 16 September.

CAISO also had to file a generation-adequacy report by 20 July 2026 under the same docket, ahead of its show-cause response. Because FERC chose six separate show-cause orders rather than one national rule, CAISO can tailor its reform response to California's clean-energy mandates, but any binding federal large-load standard remains at least a year away.