On August 3, 2026, the Federal Energy Regulatory Commission (“FERC”) approved a settlement between its Office of Enforcement and Regulatory Accounting (“Enforcement”) and Digi Power X Inc., formerly Digihost Technology Inc. (“Digihost”), which resolved an investigation into Digihost’s operation of a cryptocurrency mining load in New York. From its investigation, Enforcement determined that Digihost violated the New York Independent System Operator (“NYISO”) Open Access Transmission Tariff (“Tariff”) by connecting its cryptocurrency mining load to a co-generation facility before completing the required NYISO interconnection process. Digihost stipulated to the underlying facts but neither admitted nor denied the alleged violation.
Under the settlement, Digihost will pay a $45,000 civil penalty and submit annual compliance monitoring reports to Enforcement for two years, with the possibility of a third year at Enforcement’s discretion. The settlement is noteworthy not only for its application of NYISO interconnection requirements to a large cryptocurrency mining load but also because it follows in the footsteps of Enforcement’s January 2025 settlement with Stronghold Digital Mining Inc. (“Stronghold”) and Scrubgrass Reclamation Company, L.P. (“Scrubgrass”), which involved another cryptocurrency mining facility’s participation in FERC-jurisdictional markets.
The Digihost Investigation
Digihost’s cryptocurrency mining operations were located at a 55-megawatt (“MW”) co-generation facility in Western New York, which was interconnected to the 115kV transmission system of Niagara Mohawk Power Corporation d/b/a National Grid (“National Grid”). In 2021, Digihost agreed to purchase the facility and, before closing on the acquisition, constructed a data center for cryptocurrency mining at the site. In February 2022, Digihost connected its cryptocurrency load to the facility. Although, at that time, Digihost had begun discussions with NYISO regarding its power supply, it had not yet submitted the required interconnection proposal to NYISO before connecting the cryptocurrency load.
That omission became significant as the mining operation increased the facility’s demand. In April 2022, National Grid warned Digihost that the increased demand raised reliability concerns for the grid because it had not been preceded by adequate notice and appropriate analysis. National Grid advised Digihost to reduce demand or risk having its load disconnected, and the transmission owner sent a second warning eight days later. Digihost’s load, which had reached approximately 30 MW at its peak, was shut down on April 30, 2022.
Digihost subsequently submitted an interconnection request to NYISO in September 2022. NYISO accepted the facility as a behind-the-meter resource, and, in December 2025, it approved the facility’s System Impact Study without requiring system modifications.
Stemming from a July 2024 referral from Potomac Economics, Ltd., NYISO’s Market Monitoring Unit, Enforcement opened the investigation and later concluded that Digihost violated NYISO’s Tariff in 2022 because the Tariff required the interconnection proposal—and the accompanying reliability review—to occur before the load was interconnected to the grid. The applicable Tariff provision, Section 3.9.1, requires NYISO, working with the relevant transmission owner, to conduct technical studies to determine whether an interconnection could degrade system reliability or adversely affect the electric system’s operation.
Digihost Follows FERC Enforcement’s Stronghold/Scrubgrass Settlement
The Digihost settlement comes only a year after Enforcement’s January 2025 settlement with Stronghold and Scrubgrass — another settlement concerning cryptocurrency mining. In that matter, the business model for Stronghold, which was the upstream owner of Scrubgrass, involved acquiring power plants, installing Bitcoin mining operations, and deciding whether to use the plants’ output for mining or to sell electricity into the wholesale markets. During its investigation, Enforcement found that the Scrubgrass facility, which was a capacity resource in the PJM Interconnection, L.L.C. (“PJM”) markets, had repeatedly offered less power into the market than it could produce while using some of the remaining generation to operate Bitcoin mining equipment. The facility also purchased wholesale power from PJM, some of which Enforcement determined was incorrectly classified as station power. Enforcement concluded that Scrubgrass violated the PJM Tariff by failing to offer available capacity when economic conditions favored directing the plant’s output to Bitcoin mining. Stronghold and Scrubgrass admitted the violations, and the settlement required a $741,365 civil penalty, $678,635 in disgorgement, and compliance training/monitoring requirements.
Key Takeaways
First, the recent Digihost settlement reinforces that large load development is not solely a siting or utility-service issue. Where a cryptocurrency mine, data center, or other large load connects to facilities that are subject to a FERC-jurisdictional tariff, the applicable regional transmission organization (“RTO”) or independent system operator (“ISO) requirements, such as NYISO’s interconnection requirements, need to be fully understood and followed before operations begin. Critically, the fact that Digihost’s System Impact Study was later approved by NYISO without requiring system modifications did not alter Enforcement’s ultimate conclusion that the facility’s earlier interconnection still violated the NYISO Tariff.
Second, read together, the Digihost and Stronghold/Scrubgrass settlements demonstrate that Enforcement can and will scrutinize both sides of the large load/generation relationship—not only how a large load is interconnected to the grid but also how the associated generation is offered and operating in the wholesale markets. Companies developing co-located generation, partner generation, or other load arrangements should therefore act proactively in identifying the applicable ISO/RTO tariff requirements, coordinate with the relevant transmission owner and grid operator, and establish clear compliance procedures before energizing operations.
Finally, these settlements arrive as each ISO and RTO is revisiting its large load interconnection procedures pursuant to recent FERC directives. Revised tariff rules governing large loads are expected to be filed across the country later this year, including in New York, making early compliance planning even more important for developers of high-demand facilities.
If you have any questions about these settlements, ISO/RTO interconnection, or FERC compliance, please contact Samantha Maurer or another member of Couch White’s Energy team.