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U.S. electricity demand is projected to grow five times faster than earlier estimates, driven by data centers and manufacturing.
A report by Grid Strategies, The Era of Flat Power Demand is Over, predicts a 15% increase by 2029, reaching 947 gigawatts, with anticipated load growth surging significantly over the past two years. The report forecasts a 3% annual growth in peak electricity demand over the next five years, requiring six times more generation and transmission capacity construction. This surge is primarily driven by semiconductor manufacturing, artificial intelligence, and battery production.
“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,” the report said. “There are real risks to America’s economic, technological, and geopolitical leadership if the grid can’t keep up with demand.”
The report’s load forecasts rely on data from the Federal Energy Regulatory Commission Form 714, which tracks utility and planning area information. While the Biden administration has incentivized grid expansion through the Bipartisan Infrastructure Act, progress has been slow. Large-scale transmission investments are essential to meet rising demand reliably and affordably, but permitting reforms are needed.
Rob Gramlich, president of Grid Strategies LLC, emphasized that building transmission lines cannot take 18 years amid soaring power demand, stating: “There’s no reason we shouldn’t be able to build these lines in five or six years, and permitting reform will really help us get closer to those five or six [years].”
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