U.S. energy demand to rise 15% in next 5 years
A new report by Grid Strategies anticipates that U.S. electricity demand will increase five times faster than previously estimated over the next five years.
The culprit? Data centers, manufacturing, and increased electrification. U.S. electricity load in 2029 is expected to reach 947 gigawatts, or an increase of 15.8 percent. Annual peak demand growth would average 3 percent per year over the next five years, driven by industries like semiconductor chip manufacturing, artificial intelligence and data centers, and battery manufacturing.
The Midcontinent Independent System Operator (MISO), of which Minnesota is a part, expects to see demand growth of 9 gigawatts through 2029. ERCOT, the grid operator for most of Texas, will see a whopping 43 gigawatts of demand growth through 2029, “driven by data centers in Dallas-Ft. Worth region.” MISO’s “reported new manufacturing load totals less than 1 GW,” and high electricity prices in MISO and lower price elsewhere may be contributing to siting decisions.
The report has some sobering remarks in the section, “Power Demand Growth Could Impact U.S.’s Global Leadership” (emphasis in original):
Meeting rising demand for electricity has significant strategic importance for the U.S. In just two years, the forecast of cumulative electricity growth over the next five years appears to have increased by a factor of five, from 2.8% to 15.8%. This growth is driven by geopolitically and nationally strategic industries such as semiconductor chip manufacturing, artificial intelligence (AI), and battery manufacturing…
It is worrisome that strategic industries, such as the development of an American advanced manufacturing sector or AI leadership, may face headwinds from the limited ability of the nation’s electricity systems to respond. Electricity systems need to supply new generation, connect that generation to load, and – of course – connect new load to the system. There are real risks to America’s economic, technological, and geopolitical leadership if the grid can’t keep up with demand.
The U.S. stands to lose unless it demonstrates energy leadership. Growing electricity demand is even more reason to prioritize the maintenance and construction of affordable, reliable baseload sources like nuclear energy, coal, and natural gas power plants.