{"id":97100,"date":"2025-11-07T12:15:41","date_gmt":"2025-11-07T17:15:41","guid":{"rendered":"https:\/\/www.mcguirewoods.com\/?post_type=insight&p=97100"},"modified":"2025-11-07T12:15:44","modified_gmt":"2025-11-07T17:15:44","slug":"delaware-proposes-certificate-to-operate-requirement-for-large-electricity-users","status":"publish","type":"insight","link":"https:\/\/www.mcguirewoods.com\/client-resources\/alerts\/2025\/11\/delaware-proposes-certificate-to-operate-requirement-for-large-electricity-users\/","title":{"rendered":"Delaware Proposes \u201cCertificate to Operate\u201d Requirement for Large Electricity Users"},"content":{"rendered":"\n

Delaware has joined several states and federal agencies seeking to more closely regulate the impact of large loads interconnecting to the grid. On Sept. 22, 2025, the Delaware General Assembly introduced <\/a>Senate Bill 205<\/a>, which would amend Title 26 of the Delaware Code to establish a new regulatory framework for entities seeking to use 30 megawatts (MW) or more of electricity within the state that will directly interconnect to the PJM Interconnection (PJM) transmission grid. The bill would require such entities to obtain a \u201cCertificate to Operate\u201d (COP) from the Delaware Public Service Commission (PSC) prior to commencing operations or increasing existing facility usage to the 30 MW threshold.<\/p>\n\n\n\n

The bill would enhance oversight of projects requiring significant energy (e.g., data centers), help ensure parity regarding cost allocation issues related to transmission infrastructure and upgrades, promote environmental and public safety standards, and align new developments with state energy and climate objectives. The legislature likely will not act on the bill until at least January 2026, and even if it passes, the Delaware PSC will still need to adopt implementing regulations. Additionally, it remains to be seen how state initiatives like this will interact with potential federal level processes contemplated<\/a> by the Federal Energy Regulatory Energy Commission (FERC).<\/p>\n\n\n\n

Read on for a description of the proposed bill and its potential implications for development of large load in Delaware.<\/p>\n\n\n\n

Key Provisions<\/h6>\n\n\n\n

<\/a><\/a>Scope and Applicability<\/strong><\/a><\/p>\n\n\n\n

The COP requirement would apply to any person or entity initiating the business of using 30 MW or more of electricity, as well as to modifications of existing facilities that would increase usage to this threshold. The COP requirement would only apply to projects interconnecting to the PJM grid.<\/p>\n\n\n\n

The bill would exempt public utilities operating within their service territories from the requirement, although how this exemption will be implemented in practice is unclear.<\/p>\n\n\n\n

The law would further apply to all development plans that have not received \u201cfinal plan approval\u201d from local jurisdictions as of the enactment date.<\/p>\n\n\n\n

<\/a>Application and Review Process<\/strong><\/a><\/p>\n\n\n\n

The bill would require applicants for a COP to submit a written application to the Delaware PSC. The PSC will prescribe the application form in a later rulemaking, but it must require applicants to describe the impact of the plan on transmission capacity, any associated upgrades to transmission or distribution facilities, the quantity and type of on-site backup power, if any, a \u201cstudy of impact of the plan on electricity costs in Delaware\u201d and \u201ca study of the impacts of the plan on grid reliability in Delaware.\u201d<\/p>\n\n\n\n

The PSC would have the authority as part of the COP process to (1) require financial commitments from the applicant to protect against \u201cstranded transmission investments\u201d; (2) require financial contributions in furtherance of grid modernization for any necessary transmission investment; and (3) require the applicant to secure additional generation commitments by a set timeline before the new load can be connected and supplied.<\/a><\/p>\n\n\n\n

The PSC would be required to act on a completed COP application within 90 days, with a possible extension of up to 90 additional days for good cause and if it determines that doing so is in the public interest.<\/p>\n\n\n\n

Evaluation Criteria<\/strong><\/p>\n\n\n\n

As proposed, the PSC would be required to consider the following factors when evaluating COP applications:<\/p>\n\n\n\n