SitePower

The Interconnect

Issue 04  ·  August 2026

For three years the fight was for power. In August the fight became permission — the right to build it, connect it, and switch it on.

The Read

The binding constraint on this build-out keeps moving, and in August it moved somewhere the spreadsheets aren’t ready for. Last cycle it was capital; then it was power. This month it became permission — the right to build generation, connect it, and switch it on. The megawatts exist. The money exists. What turned scarce is a regulator, a grid operator and a community all saying yes to the same parcel.

Texas set the tone. On 3 August the Governor directed ERCOT to audit pending data-centre projects and deny grid connection to any that fail the state’s requirements — a review now covering roughly 474 GW of large-load interconnection requests, about 90% of them data centres and more than five times the state’s record peak demand. Read past the headlines: this is a freeze on grid-connection reviews, not a construction ban — several outlets got that wrong. But New York’s 50 MW permit pause, Italy’s queue past 95 GW, Spain’s renewables-matching decree and a US executive order restricting foreign-made grid equipment all point the same way. The gate narrowed in five jurisdictions at once.

And yet the gate still opens — selectively. On 26 August, Georgia’s PSC approved a 3.2 GW contract for OpenAI’s Effingham County campus. Not because the power was sitting there — Georgia Power has to build it — but because the contract structure insulated ratepayers and produced a demonstrable consumer benefit: roughly $950m of annual system savings from 2029, about $15 a month off a typical residential bill, with OpenAI paying the full infrastructure cost. That is the tell. Permission is now something you engineer into the deal, not something you apply for at the end. Georgia is the template.

If you want the month in a single trade, take Tritax Big Box. It raised £350m in early August to fund two Greater London data centres — after securing 235 MW of grid-connection agreements. The connection rights, not the land, justified the raise. The same logic ran everywhere: De Soto’s energy-services agreement, not its 1,440 acres, is what carried a ~$475m purchase; Core Scientific’s Polaris deal made power availability, not price, the swing term. The priced asset is now the deliverable megawatt, not the acre.

Capital didn’t shrink this month; it changed shape. NVIDIA quietly became the sector’s largest single financing source — up to $105bn behind OpenAI’s Ohio campus alone — which makes it also the sector’s largest concentration risk. As one of our briefings put it, capital, power and silicon are merging into single entities; treat them as one exposure, not three. Underneath, the warning lights blink: AI-linked debt tracking ~$570bn this year, an ABS take-out need near $300bn against roughly $35bn actually raised in the first half, and banks quietly syndicating their exposure to pensions and insurers. The money is abundant. Who ultimately holds it is not resolved.

The Month in Power

If you track five moves, track these.

Texas freezes ~474 GW pending an audit. On 3 August the Governor directed ERCOT to audit up to 300 pending large loads; the review covers ~474 GW, ~90% data centres, targeting completion by December with the interconnection study running to April 2027. Crucially a pause on grid-connection reviews, not a construction ban — the single most consequential development of the month.

Georgia approves OpenAI’s 3.2 GW — because the contract protected the ratepayer. Confirmed, 26 August. Roughly $950m of annual system savings from 2029, about $15/month off a typical bill, OpenAI paying full cost and offering up to 1 GW of demand response. The gate opens for whoever brings a consumer benefit. This is now the template.

Tritax raises £350m on 235 MW of connection rights. Confirmed, 5 August. Not the London land — the grid-connection agreements are what justified the raise. The cleanest single proof that contracted power, not the acre, is the financeable asset.

NVIDIA becomes the marginal lender — and the concentration risk. Up to $105bn behind OpenAI’s Ohio campus, equity into Lancium, seats in KKR’s Helix and the Aligned consortium. Capital, power and silicon merging into one exposure. Watch the counter-signal: NVIDIA reportedly paused some financing-backstop arrangements over antitrust scrutiny (~75% accurate) — which matters for anyone whose model assumed its credit.

The SMR reality check. More than 9.8 GW of nuclear is committed to AI across 13 projects, every major US hyperscaler signed — and just ~1.92 GW is actually operational, with perhaps a 25% chance SMRs carry meaningful data-centre load before 2032. Gas is the bridge, and will be for years. The tell of the month: SMRs were re-pitched on an earnings call using the very Texas freeze that threatens their timeline as the sales argument.

From the Desk

Permission is now a designed asset.

A year ago the first diligence question was where the power was coming from. This month it became sharper still: has this site already won its political fight, and is the power actually contracted. Georgia answered it the right way — the 3.2 GW approval cleared because the deal was engineered to protect the ratepayer and show a $950m public benefit, not because anyone lobbied harder. Permission, it turns out, is something you design into the structure, not something you request at the end.

This isn’t only a US story, and it’s coming home. Australia dropped its federal renewables mandate for data centres in August, but a broader framework of mandatory energy, water and land-use standards is still being written, with draft legislation expected end-2026. The developers who treat community and regulatory work as a core competency — the way the energy industry always has — will build. The ones still treating it as friction to minimise will keep underwriting projects that never switch on.

The Call

Stop bidding on acres and announced gigawatts. Bid on the deliverable megawatt — power that’s contracted, connected, and sitting on land that has already made its peace with the neighbours. If you build technology, make it the fastest route to a switched-on, permitted megawatt. If you develop sites, buy the political fight that’s already been won. If you deploy capital, underwrite the permission and the exit as hard as you underwrite the return.

The priced asset is the deliverable megawatt, not the acre.

— Nigel Broomhall, SitePower

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