Large-Load Tariffs & Co-Location Rules

Glossary

Behind-the-meter co-location

Placing a large load physically beside a generator and wiring it directly to the plant, so power flows without traversing the public transmission system. It promises speed and savings but raises scrutiny whenever the load still relies on the grid for backup and stability.

Contribution in aid of construction

An up-front payment a customer makes for the interconnection facilities built to serve it, so the utility need not rate-base those facilities. Because the cost never enters shared rates, it prevents cross-subsidy and makes a large-load deal easier to defend.

Cost-of-service ratemaking

The regulatory tradition that sets rates so each customer class pays the cost it causes the system to incur. Applied to large loads it governs whether a data center's grid upgrades are assigned to that customer or spread onto other ratepayers.

Curtailment obligation

A clause letting the utility order a large load to reduce or interrupt its draw during defined system-stress conditions. In exchange the load receives faster, cheaper connection because the grid need not build for a peak the load agrees to step back from.

Demand charge

A tariff component billed on the customer's highest measured demand in a period, typically dollars per kilowatt of peak per month. It recovers the cost of capacity, the wires and transformers sized to the customer's peak, and rewards high, flat load profiles over peaky ones.

Interconnection study queue

The ordered process a new large load must pass through, feasibility, system-impact, and facilities studies, before it can be energized. Position and vintage in the queue, plus the upgrades the studies identify, gate when and whether the load can actually connect, often over a span of years.

Minimum take (take-or-pay)

A tariff provision under which the customer commits to buy, or pay for, a floor quantity of demand or energy regardless of actual use. It guarantees the utility enough revenue to recover the dedicated upgrades it builds before the load ramps.

System-impact study

The engineering analysis that models a proposed load against the transmission network under many contingencies to find thermal overloads, voltage violations, and short-circuit problems it would create. Its findings drive the specific network upgrades the customer must fund.