On January 29, 2026, as back-to-back winter storms pushed electricity demand to near-record levels across the Southeast and Mid-Atlantic, the U.S. Department of Energy extended emergency orders authorizing utilities to direct data center backup generators to operate during grid emergencies. The orders, issued under Section 202(c) of the Federal Power Act, covered both Duke Energy's Carolinas territory and the 13-state PJM Interconnection region.
The Emergency Orders
The DOE issued four categories of emergency orders:
Order 202-26-05A (Duke) / 202-26-02A (PJM): Maximum Generation
Authorizes all generating units to operate at maximum output, overriding federal, state, or local air quality permits and environmental limitations. PJM order expired February 2, 2026 at 11:59 p.m. EST. Duke order expired February 3, 2026 at 12:00 p.m. EST.
Order 202-26-07A (Duke) / 202-26-06A (PJM): Backup Generation Direction
Authorizes utilities to direct backup generation at data centers and other large load customers to operate. Designated as a "last resort" measure before or during an Energy Emergency Alert (EEA) Level 3. Same expiration dates as maximum generation orders.
Both sets of orders were extensions of emergency measures originally issued on January 24 and 26, 2026, during the initial onslaught of Winter Storm Fern.
Duke Energy Florida: Conservation Request
On the morning of February 2, 2026, Duke Energy Florida issued a voluntary conservation request to customers from 5:00 a.m. to 9:00 a.m. EST, citing "unusually high electricity demand" driven by extremely cold temperatures affecting the Southeastern United States.
The utility asked customers to:
- Lower thermostats to the lowest comfortable setting
- Delay major appliances (washers, dryers, dishwashers) until after 9 a.m.
- Turn off unnecessary lights and unplug unused devices
- Shift EV charging to midday hours when demand is lower
NERC Long-Term Reliability Assessment
On January 29, 2026, the North American Electric Reliability Corporation (NERC) released its 2025 Long-Term Reliability Assessment. The assessment warned of a "worsening" outlook for the bulk power system, identifying multiple regions at "elevated" or "high risk" of future shortfalls.
NERC Assessment: Key Findings
- Demand growth accelerating. After decades of flat electricity demand, load growth of 3-4% annually is driven primarily by data centers.
- Retirements outpacing additions. 54 GW of thermal capacity has retired across PJM since 2011, with 24-58 GW more at risk by 2030.
- Reserve margins shrinking. PJM's December 2025 auction fell 5.2% short of reliability requirements—the first such shortfall.
- Winter vulnerability increasing. Natural gas plants face fuel supply constraints and mechanical freezing during extreme cold.
Data Center Demand in Affected Regions
- Virginia (Dominion Energy)
450 operational data centers, 10.2 GW of additional capacity planned, 40 GW total pipeline
- Duke Energy Carolinas
6 GW of data center load growth, with 2 GW signed in Q3 2024 alone
- PJM Region
16.9 GW of planned data center capacity in Pennsylvania alone; 5.2% capacity shortfall in December 2025 auction
Development Timelines
The mismatch between data center construction and grid infrastructure development:
| Category | Timeline / Capacity |
|---|---|
| Data center construction | 18-24 months |
| Generation and transmission development | 5-10 years |
| Utility interconnection queue (Oncor alone) | 186 GW |
| Total utility load growth pipeline | 326+ GW |
Policy Responses
On January 15, 2026, governors of all 13 PJM states signed a Statement of Principles calling for emergency capacity auctions and cost allocation to data centers. FERC's December 2025 ruling found PJM's behind-the-meter generation rules "no longer just and reasonable," ordering reforms to address co-located generation arrangements.
In Texas, Senate Bill 6 and new ERCOT emergency protocols give grid operators additional flexibility with large loads. ERCOT's January 2026 emergency orders authorized directing backup generation "whether synchronized or not to the bulk power system."
Analysis: Data Centers and Grid Volatility
The emergency orders raise questions about how backup generation actually functions during grid emergencies—and what role data centers play in system reliability.
What Backup Generation Orders Authorize
In PJM, MISO, and most grid regions, when a data center runs its backup generators during a grid emergency, it is not providing power to the grid. It is taking its own load off the grid by powering itself. The data center consumes the same amount of electricity; it comes from on-site diesel or natural gas generators instead of the transmission system. Typical backup generators are not interconnected for grid export—they are designed to "island" the facility.
This means the backup generation orders authorize utilities to force data centers to temporarily remove their load from the grid—not to contribute power for homes, hospitals, or other customers. The situation may differ in ERCOT, where regulatory structures provide more flexibility, and could evolve as FERC's December 2025 ruling on behind-the-meter generation takes effect.
The Planning Gap
The core issue is a mismatch between data center development and grid planning. Data centers can be constructed in 18-24 months. The generation and transmission infrastructure to serve them takes 5-10 years. Without holistic planning that accounts for this gap, each new data center reduces the reserve margin available during peak demand events—increasing system volatility.
The 5.2% capacity shortfall in PJM's December 2025 auction—the first in the grid operator's history—arrived after years of data center load growth that outpaced generation additions. The emergency orders issued during Winter Storm Fern and Winter Storm Gianna are a symptom of this imbalance.
The Path Forward
The governors' Statement of Principles and PJM's proposals signal that policy is beginning to address these dynamics. Key elements under consideration:
- Cost allocation requiring data centers to fund infrastructure they necessitate
- Curtailment requirements for data centers without self-supplied generation
- Expedited interconnection processes for generation projects
- Backstop capacity procurement mechanisms
Whether these measures will be implemented quickly enough to address the 326 GW pipeline of utility load growth—the majority from data centers—remains to be seen.