ERCOT Board of Directors approves PGRR 145, Batch Zero process while PUC rule on refundability of security deposits remains forthcoming

PGRR 145 creates a study process whereby ERCOT will conduct one unified batch study, which is being referred to as “Batch Zero,” for large loads that meet certain criteria. This process replaces the prior interconnection process for large loads, whereby interconnecting transmission and distribution service providers (TDSPs) conducted separate studies for each project. 

Eligibility for Batch Zero: PGRR 145 establishes two general categories of large loads to be considered in Batch Zero. The first category is base load, which is not subject to further study, including in Batch Zero. This category covers advanced projects that have made significant capital commitments to commissioning. The second category is study load, which will be studied in Batch Zero and offered capacity based on study results. This category covers projects that are less advanced in their development. 

PGRR 145 sets eligibility criteria for inclusion in the Batch Zero study process and establishes a timeline for the study process. Among other requirements, large loads seeking inclusion in Batch Zero must complete certain studies by July 10, 2026, and the interconnecting TDSP must inform ERCOT by July 24, 2026, that the large load has met other requirements, such as posting security deposits for transmission system upgrades. Refundability of these deposits will be governed by forthcoming PUC Substantive Rule 25.194 (which is expected to be finalized in August or September 2026) and is discussed further below. 

Batch Zero Study Results: ERCOT will release the study results from Batch Zero and corresponding capacity offers no later than April 9, 2027. Once those offers are released, each project will have a set period to accept its capacity offer by executing an interconnection agreement or else forfeit its capacity allocation. This time period will be established in pending PUC Substantive Rule 25.194. PUC Staff’s most recent proposal for this time period was 60 days. Commissioners signaled general approval of the 60-day proposal but also openness to stakeholder feedback.

Study Deposits: The most recent PUC Staff proposal for refundability of security deposits depends on the type of project. Under this proposal, the most advanced base loads would post fully refundable security deposits for system upgrades because they have already made significant capital commitments and do not need to be filtered by the posting of a security deposit. Less advanced base loads would face 50% refundable security deposits, while study loads would have 80% refundable deposits. All refund percentages would be applied after netting fees and costs. Direct interconnection costs would not be refundable for any category of projects. PUC commissioners expressed approval of this refundability framework at past Open Meetings, but the criteria for each category continue to evolve, creating change-of-law risk for projects and their financiers.

Next Steps: PGRR 145 is now before the PUC for approval, which is the final step in the approval process. The next PUC Open Meetings are June 17 and 18. No agenda has been posted yet for these meetings, but agendas will be posted seven days before each Open Meeting. 

These regulatory processes continue to evolve based on stakeholder feedback. For inquiries about more specific details or ongoing analysis, please contact the Eversheds Sutherland regulatory team. 

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