Speed to power is now the primary factor driving data center site selection, ahead of community support, latency, and proximity to customers, according to JLL's 2026 Global Data Center Outlook. The same dynamic is increasingly affecting manufacturers, semiconductor fabs, and battery plants, where delayed grid connections can postpone production, hiring, and revenue generation long after the rest of a capital plan is ready to execute.
A Cheaper Rate Doesn't Help a Facility That Can't Open on Schedule
Electricity price still matters for energy-intensive operations, but it has stopped being the deciding variable in a growing number of site searches. A facility slated to start production in 2028 generates nothing if the substation or transmission upgrade it depends on isn't finished until 2030, and a modestly lower electricity rate does little to offset two years of delayed revenue, financing costs, and idle labor. Although the U.S. interconnection queue has declined from its peak, more than 2,000 gigawatts of proposed generation and storage capacity were still awaiting interconnection at the end of 2025, according to Lawrence Berkeley National Laboratory's annual queue report, and wait times in major grid regions still commonly stretch close to five years or longer. Procurement and strategy teams increasingly frame the question differently as a result: not what power costs, but whether the party delivering it can be trusted to hit the date on paper.
Rising Construction Costs Are Raising the Price of Getting the Timeline Wrong
JLL tracks average global data center construction costs climbing from $7.7 million per megawatt in 2020 to $10.7 million by 2025, with a further 6% increase forecast to $11.3 million per megawatt in 2026. Rising construction costs raise the stakes of getting the timeline wrong: a predictable energization date protects a much larger capital number today than it did five years ago. JLL also projects hyperscalers will build roughly 41 gigawatts of owner-occupied data center capacity between 2026 and 2030, nearly doubling that segment to 70 gigawatts, with greater control over infrastructure delivery, including power planning, as one contributing factor.
Regulators Are Starting to Formalize What Certainty Is Worth
Federal regulators have taken notice of the same gap. FERC's Order No. 2023 introduced sweeping reforms intended to accelerate generator interconnection through cluster studies, stricter readiness requirements, and standardized procedures. Implementation is underway, but many developers still face multiyear timelines as existing backlogs work through the system. Buyers who signed power purchase agreements assuming projects would reach commercial operation on schedule have learned that a signed contract is not the same thing as a guaranteed delivery date. PJM and several other grid operators are now revising their processes for evaluating large new electricity loads as demand from data centers and advanced manufacturing accelerates.
Procurement's Job Has Moved Earlier in the Project Timeline
That shift is changing what procurement teams are actually hired to do. Historically, energy contracts got negotiated after a site was already chosen. Increasingly, utilities, transmission owners, and engineering firms are being asked to document construction schedules, available capacity, and realistic energization dates before a company commits capital to a location at all. The job has broadened from negotiating the lowest rate to assessing execution risk: evaluating whether the infrastructure behind a quoted price can actually be delivered on the timeline a capital plan requires. Developers who secure that regulatory certainty upfront, rather than negotiating for it after the fact, are increasingly winning projects that a lower electricity rate alone would not have secured.
