AI Summary • 12 Data Sources Verified 2026 Executive Brief: The AI Factory Era
**Bottom Line:** The 2026 infrastructure paradigm has shifted from passive storage to **AI Factories**.
Key Data Points
- 2026 Capex (Big 5): $600B+ projected spend
- AI Intensity: 45-57% capex/revenue
- Density Standard: 100kW+ per rack
Queue AE2-103 — Probability of Deliverable MW
Baseline assessment of AI datacenter readiness, covering fiber access, interconnection timelines, curtailment risk, and permitting hurdles. Scores above 85 signal “deploy now” sites, 70-84 require 6-12 months of prep, and anything below 70 needs heavy investment or an alternate location. Avoid costly missteps by pairing this scorecard with power mitigation tactics from the [ERCOT Curtailment Playbook](/playbooks/ercot-curtailment-playbook-2025) or queue navigation insights in the [PJM Interconnection Guide](/playbooks/pjm-interconnection-queue-guide-2025).
Readiness Market Signals
Power availability, interconnection queues, and fiber access now dictate AI siting. The 2026 "Power-First" development paradigm means grid capacity outweighs latency. Expect 24-36 month queues. SMR (Small Modular Reactor) roadmaps are becoming a key differentiator for 2030+ readiness. Close fiber gaps early, but prioritize power contracts above all.
How Readiness Moves the IRR
Timeline slippage and mitigation capex crush project IRR. A 50MW rollout on a Tier 1 site (score 85+) energizes in ~6 months with <$5M in enabling spend. A Tier 3 site (<70) often needs $15-25M in upgrades and adds 12-18 months before first revenue—equating to $150-230M in deferred GPU lease revenue at $12-18M/month. Model both paths inside the [LCOC / IRR calculator](/tools/lcoc-irr-dscr), layering in curtailment penalties from the [ERCOT Curtailment Playbook](/playbooks/ercot-curtailment-playbook-2025) or PJM queue delays to surface true NPV impacts.
Timeline Impact
12-18
months faster (85+ vs <70)
Revenue Delay Cost
$150-230M
lost revenue (50MW project)
Curtailment Loss (10%)
$1.2-2.0M
per month per 50MW
IRR Impact
+3-5%
percentage points (ready vs not)
Critical Readiness Factors for AI Deployments
AI datacenter readiness assessment evaluates five interconnected infrastructure dimensions, each with specific thresholds determining deployment viability. (1) Fiber connectivity: sites must be within 10 miles of tier-1 fiber backbone to achieve <2ms latency to major internet exchanges at reasonable extension costs (<$2M). Beyond 10 miles, fiber costs escalate to $3-5M and introduce 4-6 month construction delays. (2) Substation capacity: local substations must have 1.5-2x your load capacity available (75-100MW available for 50MW deployment) to handle redundancy requirements and peak demand without triggering expensive substation upgrades ($10-20M, 12-18 months). (3) Interconnection queue position: evaluate both queue length (number of projects ahead) and historical completion rates. ERCOT shows ~60% queue completion rates; PJM ~40%; CAISO ~35%. Projects in position >100 face severe timeline uncertainty. (4) Curtailment/reliability metrics: analyze historical curtailment hours (target <5% annual hours), grid stability scores, and whether site qualifies for demand response programs that monetize curtailment. (5) Permitting environment: evaluate local permit approval timelines (3-12 months typical), environmental review requirements, and community opposition risk. Sites in designated industrial zones streamline permitting versus greenfield locations.
Substation Buffer
1.5-2x
load capacity margin
Interpreting Readiness Scores: Deployment Timelines
Our readiness scoring framework (0-100 scale) translates infrastructure assessments into deployment timeline expectations and risk profiles. Tier 1 (85-100 points): "Deploy immediately" sites with fiber <5 miles, substation capacity >1.5x load, queue position <20, curtailment <5%, and favorable permitting. Typical timeline: 3-6 months from site selection to power-on. Tier 2 (70-84 points): "Good enough" sites requiring moderate infrastructure work—fiber extensions 5-10 miles ($1-3M, 3-6 months), substation upgrades <$10M, queue position 20-50, curtailment 5-10%. Timeline: 6-12 months. Tier 3 (50-69 points): "Development required" sites needing significant investment—fiber >10 miles, major substation work ($10M+), queue position >50, curtailment >10%, or complex permitting. Timeline: 12-24+ months. Below 50 points: consider alternative sites unless strategic factors (tax incentives, land costs, long-term power contracts) justify extended timelines and infrastructure investment. Most successful AI datacenter projects target Tier 1-2 sites to minimize deployment risk and capital requirements.
Below 50
Consider alternatives
high risk
Implementation Guide: Advancing Site Readiness
Implementing site readiness assessment for PJM interconnection queue AE2-103 time to power requires systematic evaluation of infrastructure factors. Begin with desktop analysis using publicly available data: fiber route maps, utility substation locations, interconnection queue databases, and permit records. Conduct site visits evaluating physical constraints: proximity to fiber points-of-presence, distance to substations, land availability for expansion, and environmental/permitting risks. Engage utility providers for preliminary interconnection studies: request available capacity at nearby substations, typical interconnection timelines, and upgrade requirements for your load profile. Analyze historical grid data: curtailment frequency, reliability metrics, and power pricing patterns. Evaluate regulatory environment: permitting timelines, environmental review requirements, and community acceptance risks. Score sites across readiness dimensions (fiber, power, interconnection, curtailment, permitting) using standardized rubrics to enable objective comparison. For sites scoring 70+, proceed with detailed due diligence: formal interconnection applications, fiber provider negotiations, and permit pre-filing consultations. Build contingency plans for infrastructure gaps: fiber extensions, substation upgrades, or alternative site consideration if readiness scores prove lower than initial assessment.
Readiness Assessment FAQ
**What is a good readiness score?** Scores 85+ indicate immediate deployment capability (3-6 months). 70-84 represents good sites requiring moderate work (6-12 months). Below 70 demands significant infrastructure investment or extended timelines (12-24+ months). **How long does interconnection take?** Timelines vary by region: ERCOT 12-24 months, PJM 18-30 months, CAISO 24-36 months for large loads (50-100MW). Sites with existing available substation capacity can reduce timelines by 40-60%. **What is curtailment risk?** Curtailment measures how often grid operators reduce your power consumption during supply constraints. ERCOT shows 5-12% annual hours, PJM 2-5%, CAISO 8-15%. Each 10% curtailment costs roughly $1-2M/month per 50MW deployment in lost revenue. **How far can I be from fiber?** Target <10 miles from tier-1 fiber backbone. Beyond 10 miles, extension costs escalate to $3-5M and introduce 4-6 month delays plus latency penalties impacting distributed training performance. **Can I improve a low-readiness site?** Yes, but costs vary significantly. Fiber extensions <10 miles cost $1-3M. Substation upgrades run $10-20M+ and take 12-18 months. Queue positions cannot be accelerated without changing sites. Evaluate improvement costs versus alternative site selection.