Grid planners are drowning in connection requests. More than 233 GW of large-load interconnection applications now sit in ERCOT’s queue, with over 70% coming from data centers.
That’s nearly four times the 63 GW on the books just 14 months ago.
ERCOT received 225 new large load requests in 2025 alone. The total requests exceed 220 GW by 2030, more than twice Texas’ record peak summer demand. Energy experts are calling it a bubble.
"It definitely looks, smells, feels and is acting like a bubble," said Joshua Rhodes, a research scientist at the University of Texas at Austin. "The top-line numbers are almost laughable."
The system breaks down
ERCOT officials told board members in December the organization can no longer evaluate applications individually. Existing rules were developed to handle 40 to 50 large loads at a time. With 225 new requests in a single year, the system has broken down.
More than half the requests, representing about 128 GW, haven’t submitted studies for ERCOT to review. Only around 7.5 GW have actually connected to the grid.
"We know it’s not all real. The question is how much is real," said Michael Hogan, senior advisor at the Regulatory Assistance Project.
What’s driving the surge
AI is the culprit. Data centers running AI workloads consume far more electricity than traditional computing facilities. Tech companies are racing to secure power, leading many to submit multiple speculative applications across different sites.
Companies are hedging bets, submitting applications for different locations and planning to move forward with whichever proves most advantageous.
Beth Garza, a former ERCOT watchdog, sums it up bluntly: "Those figures are crazy big."
ERCOT responds
The grid operator launched a new Interconnection and Grid Analysis division in January 2026 and is partnering with McKinsey to develop solutions.
The Public Utility Commission is implementing Senate Bill 6, which requires large customers to pay a $100,000 interconnection fee and disclose duplicative requests.
The fee should filter out tire-kickers. If ERCOT sees that a single developer submitted five different 1 GW applications, planners gain insight into how much capacity is duplicative.
What it means for contractors
For construction firms, electrical contractors, transmission builders and service providers, the surge represents potential opportunity. If even a fraction materializes, Texas will need massive infrastructure buildout.
The challenge is uncertainty. Which projects have secured power purchase agreements? Which have completed interconnection studies? Which developers have track records?
Data center construction requires specialized electrical infrastructure, redundant power systems and sophisticated cooling.
The contractors who understand these requirements will win the real projects. Transmission and distribution work may offer more certain opportunities. Texas will need grid upgrades regardless of which specific projects move forward. The substation market should see sustained activity.
Separating real from speculative
Smart contractors are asking hard questions. Has the developer disclosed their project publicly? Do they own the property? Have they hired engineering firms?
Projects that moved beyond interconnection requests into actual development spend money on engineering, permitting and site preparation. Those activities signal serious intent.
Established operators approach projects differently than startups. Track records count. Applications in proven markets may have better odds.
Looking ahead
ERCOT’s new processes and the PUC’s regulatory changes should bring clarity through 2026. The interconnection fee will likely reduce the queue as speculative applications withdraw.
Whether 233 GW of requests becomes 50 GW of actual projects or 150 GW, Texas faces significant infrastructure investment. The contractors who position themselves wisely will benefit.
The opportunity is real. The challenge is figuring out which opportunities are real.
