Miner Weekly: Texas’ Peak Game Is Getting Harder as AI Load Floods ERCOT
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ERCOT’s Four Coincident Peak (4CP) mechanism is not new. For years, large loads in Texas have been able to lower their transmission cost exposure by reducing demand during four 15-minute intervals: the highest systemwide demand interval in each summer month from June through September.
But the old rule is becoming newly important.
Texas is preparing for a much larger transmission buildout as the grid absorbs unprecedented load growth. As detailed previously, ERCOT witnessed an exponential volume of interconnection requests from large load customers, in particular, data centers. Meanwhile, according to TheEnergyMag, North American public bitcoin miners alone had more than 5.1 GW of operational power capacity in Texas as of Q1.
For these large-load customers, even a small change in transmission cost exposure can translate into a meaningful sector-wide operating cost swing. That is why operators with large but flexible loads are incentivized to navigate the 4CP intervals by curtailing their activities. But the influx of interconnection requests since 2025 has apparently prompted policymakers to review whether large flexible loads are avoiding too much of the cost by curtailing during a narrow set of summer peaks.
The debate also comes at a difficult point for bitcoin miners, the most natural flexible load operators. Bitcoin’s mining revenue remains compressed as the network difficulty remains high. In that environment, every component of the power stack matters: energy price, uptime, curtailment revenue, demand charges, ancillary-service pass-throughs, and transmission charges.
That is why the 2026 4CP season matters even before Texas finalizes any rule change. And if the state eventually moves from the current 4CP framework toward a 12CP design, the problem could become harder. Instead of defending four summer intervals, miners and other large load customers may have to manage coincident-peak exposure across all 12 months of the year.
What 4CP is
ERCOT’s 4CP mechanism allocates transmission costs to certain large consumers based on their demand during four specific systemwide peaks. The relevant moments are the single highest 15-minute demand intervals in June, July, August and September. A large load’s average demand across those intervals becomes the basis for its transmission cost allocation in the following year.
A facility can run profitably through most low-price hours, but if it is consuming power during the wrong 15-minute interval, that load can become embedded in its fixed-cost structure for the next 12 months. Conversely, if the site is curtailed during the coincident peak, it can sharply reduce that exposure.
That is why 4CP has become a summer ritual in ERCOT. Operators watch heat, system load, day-ahead and real-time demand signals, solar output, battery charging, DC tie flows and ERCOT forecasts. They do not know the official 4CP interval in real time. They only know it after the fact. So the decision is probabilistic: curtail early enough to be offline if the interval becomes the monthly peak, but not so often that the cure becomes more expensive than the disease.
LoD’s review of the 2025 season offers a useful illustration. All four coincident peaks last summer landed on weekdays in a narrow late-afternoon window: June 19 at 5:00 p.m., July 30 at 5:00 p.m., August 18 at 5:00 p.m. and September 4 at 5:30 p.m.
The timing looked predictable in hindsight. The difficulty is that each month contained multiple hot days and broad afternoon demand plateaus where several 15-minute intervals were close enough to plausibly become the peak. “Around 5 p.m.” is not precise enough when a quarter-hour interval can set a year of transmission costs.
The 2026 4CP watch has already started
Luxor said in a LinkedIn update that June’s early high-water mark had reached 81.3 GW on the first day of the season last week, prompting the first curtailment dispatch of 2026 for Luxor Energy members. The next day, ERCOT load peaked near 80.0 GW around 3 p.m. CT, close enough to the prior mark to trigger a second dispatch from Luxor’s 4CP engine.
The next test is coming soon. ERCOT’s public dashboard showed demand forecast at 80,343 MW around 6:00 p.m. CT on June 11.
None of those data points means that any specific interval will ultimately become June’s 4CP interval. The official coincident peak is only known after the fact. But the early-June data shows how quickly the monthly peak-defense problem can become active. Even before Texas reaches the hottest stretch of summer, ERCOT can produce demand levels high enough to force curtailment decisions.
For miners, the decision is not simply whether power prices are high enough to justify shutting down. LoD’s 2025 review showed that the largest demand moment of the year occurred around 84 GW while power at that moment settled near $25/MWh. Prices rose later in the evening. That means the 4CP interval can be one of the most financially important moments of the month even when real-time energy prices are not flashing red.
This is the central 4CP tension. Curtailing for 4CP is not about dodging expensive power. It is about giving up potentially profitable runtime to avoid a transmission charge that may not be confirmed until after the season ends.
Why the rule is under pressure
4CP was designed to give large loads an incentive to reduce demand during the system’s summer peaks. In theory, that reduces the need to build transmission infrastructure that only serves a few extreme demand intervals.
But the Texas grid has changed.
Solar generation has shifted parts of ERCOT’s daily risk profile. The system’s highest demand can occur while solar is still contributing enough generation to keep real-time prices relatively low. The more stressful price intervals can arrive later, as solar output fades and evening demand remains elevated.
At the same time, large flexible loads have become better at predicting and avoiding 4CP intervals. That has raised a policy question: if data centers, bitcoin mines and other large loads are part of the reason Texas needs new transmission investment, should they be able to avoid a large share of transmission charges by curtailing during four 15-minute summer intervals?
That is the backdrop for the 4CP-to-12CP discussion. A 12CP design would generally spread the cost-allocation signal across the highest-demand interval in each month of the year, rather than only the four summer months. Depending on the final design, the proposal could also involve a longer measurement interval.
The policy goal would be to make cost allocation broader and harder to avoid, while preserving some incentive for large loads to reduce demand when the grid is strained.
Why transmission cost matters now
Transmission cost is not the same thing as wholesale energy price. Operators can buy power at attractive headline prices and still carry a meaningful all-in power cost once transmission, congestion, retail adders, ancillary services, demand charges and other pass-through items are included.
LoD estimated full 4CP exposure at roughly $50,000 per MW per year, or about $1.25 million annually for a 25 MW site. For a continuously running load, that converts to roughly $5.70/MWh before considering site-specific tariffs, retail structures, hedges, behind-the-meter arrangements, or curtailment behavior.
That may not sound large in isolation. But it becomes meaningful when scaled across a fleet and when margins are thin, especially for bitcoin miners today.
In a high-hash-price market, operators can tolerate more inefficiency. A miner may still care about 4CP, but a few extra dollars per MWh or some unnecessary curtailment can be absorbed by strong mining revenue.
That cushion is much thinner today with Bitcoin’s mining revenue per unit of compute staying near all-time lows.
The 4CP decision also interacts with hashprice in a direct way. Curtailment is not free. Every hour offline means forgone bitcoin production. When hashprice is high, the opportunity cost of curtailment is high. When hashprice is low, the relative value of avoiding a fixed transmission charge rises.
That creates a narrow optimization problem. Large mining sites are flexible loads, but flexibility only has value if it can be controlled precisely. Shutting down too late misses the transmission benefit. Shutting down too early or too often sacrifices uptime. Repeated stop-start cycles also introduce operational complexity, thermal cycling and potential wear.
In a 12CP world, that only gets more complicated.
For Texas miners, 4CP has always been a hidden margin lever. In 2026, it is becoming something larger: a test of whether operators can monetize load flexibility without sacrificing too much uptime, and whether the Texas market will continue to reward that flexibility under the same rule structure.
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