backOn October 10, 2025, the Federal Energy Regulatory Commission (FERC) rolled back Order 871, a regulation that had delayed construction of natural gas projects. This decision removes a major obstacle to building energy infrastructure needed for AI data centers and enhancing grid reliability.
Background on Order 871 and Its Impact
In June 2020, FERC implemented Order 871, which prohibited authorizations for construction of natural gas projects under the Natural Gas Act (NGA) during the 30-day rehearing request period or while such requests were pending. This regulation caused delays for developers, who often had to plan for potential 150-day setbacks in their construction schedules, even when no rehearing requests were submitted.
Following the U.S. Court of Appeals for the D.C. Circuit’s ruling in Allegheny Defense Project v. FERC, subsequent adjustments were made via Order 871-B and 871-C to narrow the scope of delays to projects facing opposition regarding construction, operations, or necessity. However, the fundamental framework of Order 871 remained intact, continuing to create scheduling uncertainties and added costs for developers.
Policy Changes to Streamline Energy Infrastructure Development
The Trump Administration has prioritized energy infrastructure development as a cornerstone of national and economic security. On January 20, 2025, President Trump issued two executive orders: one aiming to streamline permitting processes for energy projects and another declaring a national energy emergency, emphasizing the need for reliable power sources to support critical industries, including artificial intelligence (AI).
Later, on July 23, 2025, the administration released America’s AI Action Plan, identifying the need to expand the power grid to meet increasing demand from AI data centers. A related executive order accelerated federal permitting for infrastructure projects tied to AI, including natural gas pipelines and power generation facilities.
The Trump Administration has made the acceleration of energy infrastructure permitting and construction a key policy priority.
FERC’s Decision to Rescind Order 871
On April 14, 2025, the Interstate Natural Gas Association of America (INGAA) petitioned FERC to eliminate § 157.23 (Order 871’s regulation) entirely. The group argued that delays caused by this rule were costly and unnecessary, especially given existing protections under Allegheny. INGAA emphasized that project developers faced significant challenges due to mandatory delays, even when no opposition was raised.
FERC responded by temporarily waiving § 157.23 in June 2025 and proposing its permanent removal. In its Notice of Proposed Rulemaking (NOPR), FERC noted that the delay in construction could jeopardize the timely delivery of natural gas capacity and reliability benefits, frustrating the goals of approved projects. FERC underscored the importance of natural gas infrastructure to meet growing energy demands, particularly given the rise in electricity use driven by AI data centers.
In its October 10 ruling, FERC permanently rescinded § 157.23, stating that delays caused by the regulation hindered projects already deemed to be in the public interest. FERC highlighted that growing electricity demand, including from AI data centers, could strain the power grid, impacting reliability without sufficient natural gas infrastructure in place.
FERC explained that removing the regulation would eliminate up to five months of potential construction delays, ensuring natural gas capacity is available to address increasing demand. The Commission updated its regulations, including removing a cross-reference to § 157.23, to further streamline project timelines and promote efficient energy development.
Significance for AI and Energy Infrastructure Developers
FERC’s rollback of Order 871 is a notable development for natural gas project and AI data center developers. With power generation widely seen as a bottleneck in AI growth, this decision supports the timely construction of infrastructure critical to AI training, inference workloads, and overall data center expansion.
By removing constraints on natural gas infrastructure development, FERC aims to address resource adequacy and reliability concerns while facilitating the expansion of energy systems vital to AI-driven industries. Power is widely recognized as a critical bottleneck in AI development, and FERC’s ruling removes a key constraint on the development of natural gas infrastructure that could help meet the power generation needs of AI data centers and fast-growing AI workloads.