The fee everyone was budgeting for is gone. The money did not get cheaper.

On September 18, 2026 the Public Utility Commission of Texas filed its Order Adopting New 16 TAC §25.194, Project No. 58481, Item 218. Two hundred and seventy pages implementing PURA §37.0561 as enacted by SB 6. The rule takes effect October 8, 2026.

The headline writes itself, and it is accurate. One sentence on page 12: the commission also modifies the adopted rule to remove the interconnection fee under the SLLIA.

Every owner model built against the March proposal carried a non-refundable charge at agreement execution. That charge is gone. Anyone still quoting it is quoting a document the commission superseded today.

Now the part that will not make the summaries. Removing the fee did not reduce what a large load customer posts. It changed what the posting is, and the thing it changed into is governed by a formula with a subtraction in front of it and a release schedule tied to an agreement that does not exist yet.

Security is not a fee, and the commission said so on purpose

The rule is explicit about the distinction. Responding to EDF, the commission wrote that the recommendation with respect to the interconnection fee is moot because the commission modifies the adopted rule to remove the interconnection fee, and then added: financial security remains a requirement to protect against stranded infrastructure costs and is not a fee.

That is not throat-clearing. It is the whole design.

At SLLIA execution the large load customer posts financial security in an amount that is the greater of $50,000 per MW of contracted peak demand or the costs allocated to that customer for system upgrades as a result of an interconnection study.

Read the operator on that sentence. It is the greater of, not the sum, and not a cap. For a project whose study lands lightly, the per-MW floor governs and the number is predictable. For a project that triggers real system upgrades, the study output governs and the posting is whatever the upgrades cost. A 240 MW campus at the floor posts twelve million dollars. The same campus with study-allocated upgrades above that figure posts the upgrades instead, and nothing in the rule caps the distance between those two outcomes.

So the cost that owners could previously bound before the study is now, for a meaningful share of projects, unbounded until the study returns.

The improvement is real, and it is in the crediting

Two changes move genuinely in the owner's favor, and they deserve to be stated plainly rather than buried under the caveats.

A large load customer may elect to apply cash collateral posted as financial security under an intermediate agreement as a credit toward the financial security requirements under a SLLIA. The pre-study posting is not a second, separate payment. It carries forward.

Two conditions sit on that. Only cash collateral is creditable. A guaranty or a letter of credit is returned rather than applied, which means an owner who optimized the intermediate stage for balance sheet efficiency by posting an LC gets that instrument back and then funds the SLLIA posting fresh. The financing sequence matters more than the financing cost here.

And the credit operates on election. An owner who says nothing gets the default. Know which default your utility applies before the intermediate agreement is signed, not after.

The return schedule is where the modeling breaks

Commenters asked the commission to return more than 20 percent at energization. Rowan asked for 60 percent and Crusoe for 50 percent, and the commission declined both and kept 20 percent. When the site energizes, the utility returns 20 percent of the remaining balance, and the rest comes back in 20 percent steps as the customer hits its SLLIA payment milestones.

Three things in that sentence change a cash model.

First, 20 percent at energization, not 80. The bulk of the posting stays with the utility past commercial operation.

Second, and this is the phrase to carry into your model: 20 percent of the remaining balance. Not 20 percent of the original posting. The rule directs the utility to apply security to any outstanding amounts owed and refund what remains. Anything you owe at energization comes out first, and the percentage runs against the reduced figure. An owner who arrives at energization with an open invoice does not get a haircut on one payment. Every subsequent increment is computed off a smaller base. The subtraction compounds through the whole release schedule.

Third, the milestones that release the remaining 80 percent are the milestones identified in the customer's SLLIA. Which brings us to the thing that actually matters.

The agreement that assigns responsibility has not been written

The commission declined to specify each party's responsibilities in this rule. Its stated reason, repeated across multiple responses to commenters: that level of detail will be addressed in a separate rulemaking to adopt a SLLIA, which will set forth each entity's responsibilities.

So the rule adopted today sets the amount you post and ties its release to milestones defined in a form contract the commission has not yet drafted.

The PUCT has opened Project 59999 for the form contract, and no proposal has been filed yet. The milestone definitions in that form determine when your capital comes back. Whether a milestone is met at capacity availability or at tenant energization, whether partial phases count, whether a tenant's delay is your missed milestone: none of that is settled, and all of it is worth more to a phased campus than the fee that was removed today.

The owners who show up to that rulemaking will be arguing about their own money. The ones who read today's coverage, note that a fee disappeared, and move on will inherit whatever the utilities draft.

Capital gate on one page

Effective October 8, 2026 the adopted rule is a two-step capital gate in front of study inclusion and capacity reservation. The removed interconnection fee is not the whole cash stack.

Gate A. Before the load can be included in an interconnection study the customer must execute an intermediate agreement, provide the required disclosures, pay a $100,000 study fee, and post intermediate financial security of $50,000 per MW of requested peak demand, or of the incremental peak-demand increase on an expansion.

Gate B. After capacity is allocated, execute a SLLIA within 60 days of the study report, update disclosures, post SLLIA financial security under the greater-of test already described, and pay CIAC.

CIAC. Covers direct interconnection costs. Cash only. The interconnecting DSP or TSP invoices before those costs are incurred. Unpaid more than 10 working days and the utility draws on financial security and cancels the interconnection request. CIAC is not refundable.

Withdrawal after allocation, before the SLLIA deadline. Pay amounts owed, forfeit 20 percent of the financial security associated with the withdrawn allocated capacity, and receive the remainder.

Check with your own counsel before you rely on this.

Campus readiness on one page before the next irreversible land spend:

1. Applicability. Not energized as of October 8 and seeking a path the rule covers.
2. Gate A. Intermediate agreement, disclosures, $100,000 study fee, and $50,000/MW intermediate financial security ready by execution.
3. Gate B. SLLIA within 60 days of the study report, greater-of SLLIA financial security, and CIAC cash inside 10 working days.
4. CIAC. Cash reserved; invoices cleared before the draw-and-cancel clock.
5. 20 percent / 24-month. Withdrawal forfeiture and the 24-month energization-schedule miss path priced into the equity and lender case.
6. Disclosure audit. Named owner for required disclosures and the audit response.

Two financial security questions from the rulemaking record

Two questions in the Project No. 58481 record can be answered from the adopted rule and from the commission's responses to other commenters. One is in a data center trade group's filing, and one is in a joint comment filed in April 2026.

"Are collateral requirements proportionate to actual risk?"

The question appears in a best-practices paper by the consultancy E3, included with a data center trade group's October 10, 2025 comments in Project No. 58481, Item 13 (PDF page 18; the paper names E3 as its author on PDF page 14).

The adoption order does not cite the paper. Its responses to other commenters speak to proportionality at each stage, from the intermediate posting to the release schedule.

On the purpose of the security, the commission wrote that the financial security requirements "are intended to minimize the potential for stranded infrastructure costs as required by PURA §37.0561(b)" (Order Adopting New 16 TAC §25.194, Item 218, page 28; Texas Register, 51 TexReg 6882). It said they do that "by incentivizing large load customers to right size the requested peak demand for their projects and provide a mechanism for utilities to recover stranded infrastructure costs from a large load customer" (Order page 28; 51 TexReg 6882). In the same response it declined a request to limit forfeiture of financial security to "demonstrated, non-recoverable costs and committed expenditures" (Order page 27; 51 TexReg 6882).

Before the interconnection study, the commission said the $50,000 per MW intermediate posting is "to demonstrate a large load customer's access to the necessary capital to finance the project" (Order, Item 218, page 115; 51 TexReg 6904). It added that "Stranded infrastructure costs are unlikely before an interconnection study is completed because the interconnection study informs the necessary infrastructure to serve a load" (Order page 115; 51 TexReg 6904). It also said that "some limited costs for significant equipment and services may be determined before the interconnection study is completed" (Order page 115; 51 TexReg 6904). The rule defines significant equipment or services as "equipment with a lead time of at least 18 months and services are those necessary to interconnect the large load customer." When those are procured before the standard large load interconnection agreement (SLLIA) is executed, the interconnecting distribution service provider (DSP) or transmission service provider (TSP) "must credit" the intermediate security to their cost. If the cost is higher than the security already posted, the customer "must post additional financial security for the difference" (16 TAC §25.194(d)(2)(C); 51 TexReg 6934; Order page 119).

On size, the commission declined requests to tier the per MW amount by load size. It wrote that "The financial security appropriately scales with the size of the load because the total dollar amount is based on the size of the load" (Order page 117; 51 TexReg 6905). Declining requests to lower the amount, it determined that "the $50,000 per MW amount appropriately balances the statutory objectives of PURA §37.0561 to support business development while minimizing the potential for stranded infrastructure costs" (Order page 116; 51 TexReg 6904).

After the study, the SLLIA posting follows the greater-of test described above, so the system upgrade costs allocated to the customer set the posting whenever they exceed the per MW floor (16 TAC §25.194(f)(2)(B)(i); 51 TexReg 6937). The rule adds that "a large load customer may be required to post additional financial security related to the large load minimum billing demand," described in §25.193 (16 TAC §25.194(f)(2)(B)(ii); 51 TexReg 6937). On release, the commission wrote that tying returns to the minimum billing demand milestones "ensures that the return of financial security corresponds to the reduction in risk that the financial security is intended to secure" (Order, Item 218, page 219; 51 TexReg 6930).

"Does financial security scale to the firm portion only, or to full contracted peak demand?"

Landmark Development Services and EcoPartner Alliance asked this in a joint comment filed April 16, 2026 in Project No. 58481, Item 158. The comment asks about what it calls Provisional CLR, which the filing says "Workshop 6 introduced" and describes as "partial firm plus curtailable." That description is the filers', and Sitebraid has not confirmed it against ERCOT's own text. CLR stands for controllable load resource, a term the adopted rule takes from ERCOT protocols (16 TAC §25.194(c)(6)).

The adopted rule sizes its per MW postings on total non-coincident peak demand. The intermediate posting is "$50,000 per MW of the requested peak demand" for a new request, or per MW of the incremental increase on an expansion (16 TAC §25.194(d)(2)(B); 51 TexReg 6934). The rule defines requested peak demand as "The total non-coincident peak demand that a large load customer requests, prior to executing an interconnection agreement, that an interconnecting DSP or an interconnecting TSP serve at a single site" (16 TAC §25.194(c)(16); 51 TexReg 6932). The SLLIA posting is the greater of "$50,000 per MW of the contracted peak demand" or the allocated system upgrade costs (16 TAC §25.194(f)(2)(B)(i); 51 TexReg 6937). The rule defines contracted peak demand as "The total non-coincident peak demand that a large load customer requests that an interconnecting DSP or an interconnecting TSP serve at a single site" (16 TAC §25.194(c)(5); 51 TexReg 6932). The definition ends with the words "and is ultimately allocated by ERCOT, as stated in the SLLIA" (16 TAC §25.194(c)(5); 51 TexReg 6932).

The words firm and curtailable do not appear in the adopted section. Its controllable load provisions are disclosures: a large load customer must disclose "whether the large load customer plans to register and operate a controllable load resource" (16 TAC §25.194(f)(1)(I); 51 TexReg 6937).

One part stays open. Contracted peak demand is the demand "ultimately allocated by ERCOT," so the MW count behind the SLLIA posting depends on what ERCOT allocates (16 TAC §25.194(c)(5)). Sierra Club asked the commission to require disclosure of "whether the facility plans to register as a full or partial controllable resource and the parameters thereof." The commission declined because "that level of detail is unnecessary in the adopted rule and is better addressed in ERCOT protocols" (Order, Item 218, page 106; 51 TexReg 6902). It also wrote that "The requirements a large load customer must satisfy to be treated as a controllable load resource are established in ERCOT protocols" (Order page 107; 51 TexReg 6902). The adopted section does not say how ERCOT allocates capacity to a load that registers as a partial controllable load resource. The filing tags its question to PGRR 145, which the commission approved on June 18, 2026 and says "addresses eligibility and study requirements for batch zero load" (Order, Item 218, page 3; 51 TexReg 6876). PGRR 145 is the first ERCOT text to check for that answer.

What a phased campus should do before October 8

The rule applies to a large load customer that has not energized as of the effective date. Queue position does not exempt a project. If you are not energized on October 8, you are inside this rule.

Four things are worth doing in the next three weeks.

Re-run the posting against the greater-of test using contracted peak demand, not nameplate and not tenant-requested capacity. Contracted peak demand is now a defined regulatory term attached to real money, which makes it the correct basis for anything sized per MW, including advisory fees written against capacity.

Model the release as 20 percent of a shrinking balance, with what you owe taken out first. Then check what your covenant tests do while most of that capital is still held by the utility.

Decide the instrument at the intermediate stage deliberately. Cash credits forward. An LC does not.

And read the one clause in your tenant leases that today's rule just repriced: the minimum billing demand pass-through. Security release is tied to paying minimum billing demand. Project 58000 will decide whether that payment starts when capacity is available or when the tenant energizes. SB 6 gives the commission until December 31, 2026 to change its transmission charge rules, and Project 58000 is that rulemaking. If billing starts at availability and your leases do not pass it through on the same terms, you pay for capacity whether or not a tenant ever uses it, and the security you are waiting to get back depends on that same payment.

That is the exposure worth an afternoon this week. Not the fee.

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Verified against the Order Adopting New 16 TAC §25.194, Project No. 58481, Item 218, filed September 18, 2026, the Texas Register acknowledgement at Item 219, and the adopted text and preamble at 51 TexReg 6875. The two filed questions are quoted from Items 13 and 158 in the same project. Rowan and Crusoe asked, and the commission answered, on pages 217 to 219 of the order. The December 31, 2026 deadline comes from SB 6, Section 6(c), and the rule took effect October 8, 2026.