A 1.8-GW, $20 billion data center planned by PowerHouse Hillwood was underpinned by a $1 letter of credit — “less than the price of a cup of coffee” — that drew skepticism from FERC’s David LaCerte.

The Federal Energy Regulatory Commission on Tuesday rejected Commonwealth Edison’s “notice of cancellation” of a transmission security agreement, or TSA, for a 1.8-GW, $20-billion data center PowerHouse Hillwood Holding is developing in Joliet, Illinois.

In part, the contract dispute centers on the TSA’s credit support requirements. PowerHouse Hillwood contends it met the agreement’s initial credit requirements via a $1 posting, according to FERC’s decision.

The dispute is pending in the U.S. District Court for the Northern District of Illinois, according to the decision.

In declining to take jurisdiction over the dispute, FERC said the courts can work it out just as well as the federal agency.

“Though we decline to assert primary jurisdiction over the interpretation of ambiguous contract terms involving credit support, our commitment to fair cost allocation, ratepayer protection, and regulatory clarity remains unwavering,” FERC Chairman Laura Swett and Commissioner Lindsay See said in a joint concurrence.

FERC’s decision highlights the “criticality” of the potential reforms that the agency proposed in large load interconnection show cause orders it issued in June to regional transmission organizations and independent system operators, the commissioners said. RTOs and ISOs have until mid-November to respond to the show cause orders.

Developing “clear and consistent” terms for connecting large loads with the transmission system is crucial, Swett and See said.

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