The North American Electric Reliability Corporation (NERC) issued its highest-level grid alert this week, warning that data centers, crypto mining operations, and other large “computational loads” are creating new reliability risks as electricity demand accelerates across the country.  (NERC, May 4)

Why It Matters

• NERC is the international regulatory “grid watchdog” that ensures reliability and security of North America’s bulk electricity system.

• NERC’s Level 3 Essential Action Alert directs grid operators, transmission planners, and utilities to address risks from large loads that can unexpectedly disconnect from the grid or create significant power swings within seconds. (NERC, May 4)

• The alert follows incidents involving data centers across the East Coast and Texas, where large loads unexpectedly dropped off the grid, raising concerns about frequency, voltage, and overall power system reliability. (Utility Dive, May 5)

• A Union of Concerned Scientists representative called the alert a “big deal,” noting it is only the third Level 3 alert in NERC’s history. (PoliticoPro, May 4)

• The alert signals a broader shift toward future data center regulations that could require such large power users to register with NERC, just as entities that own and operate the electric grid must currently do. (PoliticoPro, May 4). Entities that register with NERC must comply with its grid reliability standards.

• NERC also released voluntary risk-mitigation guidelines while it develops formal reliability standards for data centers and other large loads. (E&E News May 4)

• Meanwhile, the alert outlines “essential actions” for current NERC registrants, such as stronger modeling of computational loads, more frequent stability studies, and installation of fault-recording equipment to better understand how data centers behave during grid disturbances. Grid planners are asked to respond by Aug. 3. (NERC, May 4)

• Separately, the Federal Energy Regulatory Commission (FERC) is drafting a proposal that could provide more federal oversight on how large data centers must connect to the power grid. (Latitude Media | E&E News, May 4)

Data Centers & Electricity Demand Growth

• NERC’s warning comes as data centers face growing scrutiny over their energy use, infrastructure impacts, and effects on electricity costs. (NYT, April 27)

• Eleven states have proposed legislation since late 2025 to restrict or ban data center development, while Sen. Bernie Sanders (I-VT) and Rep. Alexandria Ocasio-Cortez (D-NY) have introduced legislation to pause new data center construction nationwide. (Axios, April 5)

• At a House Energy subcommittee hearing last week, witnesses argued that large-load customers such as data centers should cover the full incremental costs of the generation, transmission, and distribution upgrades needed to serve them. (Politico | Hearing, April 30)

• Separately, the U.S. Green Building Council (USBGC) and eight partner organizations launched the Greening AI Data Centers Coalition to coordinate on non-governmental sustainability standards for AI data centers, including performance criteria for energy, carbon, water, waste, biodiversity, and community impact. (USGBC, April 22)

• Data centers are not the only source of rising power demand, but they are accelerating a broader challenge: the nation needs more generation, more transmission, faster permitting, and better grid planning to support economic growth, housing development, and U.S. technological leadership. (NYT, April 27)

Electricity Costs & Infrastructure

• Electricity costs are rising nationwide. The U.S. Chamber of Commerce’s 2026 Electricity Price Map, using 2025 data from the U.S. Energy Information Administration (EIA), shows Americans now pay an average of 13.63 cents per kilowatt-hour, up 5 percent from 2024 and 22 percent over the past five years. (Chamber of Commerce, May 5)

• The Chamber noted that rising demand alone does not determine electricity costs. States with major data center hubs, including Virginia, Texas, and North Carolina, continue to have electricity rates below the national average, underscoring the importance of generation mix, infrastructure capacity, and state-level policy decisions. (Chamber of Commerce, May 5)

• Infrastructure bottlenecks are adding to the challenge. Wood Mackenzie estimates the U.S. electrical equipment market tied to data centers could more than triple from $20 billion to $65 billion by 2030, while shortages of transformers and other equipment have stretched lead times to 18 to 36 months and pushed prices up as much as 20 percent. (Wood Mackenzie, April 28)

Roundtable View

• The Real Estate Roundtable (RER) has consistently emphasized that grid reliability is essential to expanding the nation’s housing supply, spurring new real estate development, supporting economic growth, and advancing U.S. technological leadership.

• RER supports a national “all of the above” energy strategy that invests in building efficiency, grid modernization, faster permitting, and innovation across all energy sources. (RER’s Spring Policy Priorities-Energy)

Policymakers should continue advancing permitting reforms to accelerate construction of transmission lines, pipelines, and generation plants—helping reduce delays, expand

The Real Estate Roundtable (RER) and a coalition of real estate, construction, and insurance organizations urged congressional leaders this week to include the Infrastructure Expansion Act (H.R. 3548) in upcoming surface transportation legislation. The bill would prevent property owners, contractors, and insurers from facing automatic liability in lawsuits tied to federally funded infrastructure and transportation projects. (Letter, May 6)

Why It Matters

• The coalition warned that New York’s “Scaffold Law” imposes an absolute liability standard on property owners and general contractors for gravity-related worksite injuries, regardless of fault, worker conduct, or safety precautions taken by responsible employers.

• Unlike New York, every other state uses a comparative negligence standard that allocates responsibility based on the conduct of all parties involved. (Yahoo, April 6)

• H.R. 3548 would apply a uniform national liability standard to federally funded infrastructure projects, helping ensure federal tax dollars are used efficiently for roads, bridges, transit, and other projects critical to economic growth and competitiveness.

• The coalition letter estimates the bill could save up to $2.3 billion in the Highway Trust Fund over five years by preempting New York’s absolute liability standard on federally funded projects. (Letter, May 6)

Cost Impact

• The letter states that insurance costs in New York are typically double those in other states, with many insurers withdrawing from the construction market because of the open-ended exposure created by absolute liability.

• According to a report from the Building Trades Employers Association, estimates that reforming New York’s liability standard could save taxpayers $280-$560 million for the Penn Station redevelopment and $550-$880 million for the Port Authority Bus Terminal project.

• Shifting every $100 million from insurance costs back into productive infrastructure investment could support roughly 600 full-time jobs. (Letter, May 6)

Roundtable Advocacy

• RER has long supported federal legislation to address the cost and liability impacts of New York’s Scaffold Law on federally assisted infrastructure projects.

• In 2018, RER and a broad coalition of contracting, insurance, and real estate organizations urged Congress to pass an earlier version of the Infrastructure Expansion Act, sponsored by former Rep. John Faso (R-NY). (Roundtable Weekly, Jan. 2018 | Feb. 2018)

As Congress considers the next surface transportation package, RER and its coalition partners will continue urging policymakers to advance commonsense reforms that protect taxpayer dollars and help move critical infrastructure projects forward.

The path forward for the 21st Century ROAD to Housing Act remains uncertain as House Republican leaders, the White House, and key committee leaders continue working through possible changes to the Senate-passed housing package. (Punchbowl News, May 8)

State of Play

• This week, House Financial Services Committee leadership continued efforts to find a path forward on a House-amended version of the Senate-passed housing bill, but a floor vote soon after lawmakers return from recess next week now appears unlikely. (PoliticoPro, May 6 | Politico, May 4)

• House leaders are still working through legislative language and seeking White House support before moving forward. They have made clear the Senate bill cannot pass the House as written. (PoliticoPro, May 6)

• Section 901 remains at the center of the debate, which would limit the role of large investors in the single-family housing market and impose a seven-year forced-sale requirement on certain build-to-rent homes. (Punchbowl News, May 8)

• President Trump privately raised concerns with the Senate-passed bill, despite earlier White House support for the package, and was reportedly close to publicly objecting to the Section 901 language late last week. (Politico, May 4)

• The developments follow President Trump’s recent comments to Rep. Zach Nunn (R-IA), a member of the House Financial Services Committee, that he wants the legislation moving forward. (Roundtable Weekly, May 1)

• Senate Majority Leader John Thune (R-SD) said last week that the Senate housing bill is “stuck” and will likely require direct White House involvement to resolve the standoff with House GOP leadership. (Politico, May 4)

RER Advocacy

• RER and broad housing coalitions have consistently emphasized that housing affordability is driven by supply shortages, construction costs, and mortgage rates—not institutional ownership levels—and that restricting institutional capital would only make it harder to meet the nation’s growing housing needs. (Roundtable Weekly, Jan. 9 | Jan. 16 |  Jan. 23 | Feb. 27| March 6 | March 13 | March 20 | March 27 | April 3 | April 10 | April 17 | April 24 | May 1)

• Last week, RER and a broad housing coalition urged Congress to fix the Senate-passed 21st Century ROAD to Housing Act by removing language that would undermine build-to-rent housing construction and weaken the bill’s goal of expanding housing supply. (Letter, April 30)

• The groups called on Congress to remove Section 901, pass a pro-supply housing package, and allow BTR developers and workers to get back to building the new rental homes the country urgently needs. (Roundtable Weekly, May 1)

HUD Eases Reviews

• HUD announced this week that it is revising environmental review requirements in the FHA Multifamily Accelerated Processing (MAP) Guide, eliminating outdated provisions that HUD said have added costs, delays, and complexity for lenders and developers seeking FHA-insured multifamily financing. (HUD Press Release, May 4)

• The updates are intended to reduce development costs, eliminate operational inefficiencies, and streamline requirements. (AHF, May 5)

• HUD Secretary Scott Turner said the changes are aimed at “fixing policies that have made housing expensive and difficult to build,” adding that HUD is cutting outdated requirements, reducing costs and delays, and putting FHA financing back to work to support housing production and affordability.  (HUD Press Release, May 4)

Workforce Housing Legislation

• Reps. Jimmy Panetta (D-CA) and Mike Carey (R-OH) introduced the bipartisan Workforce Housing Tax Credit (WHTC) Act (H.R. 8626), which would create the first federal middle-income housing tax credit. (Rep. Panetta Press Release, May 6)

• The proposal is estimated to finance approximately 344,000 affordable rental homes and would allow state housing finance agencies to allocate credits through a competitive process similar to the Low-Income Housing Tax Credit (LIHTC). (Novograd, May 6)

• The bill would also give states flexibility to transfer middle-income housing allocations to LIHTC and allow projects to combine both credits, helping make more mixed-income and affordable housing developments financially feasible.

RER and its coalition partners continue to urge Congress to advance a pro-supply housing package that expands production, preserves capital formation, and avoids policies that would make new rental homes harder to finance and build.