New Report Highlights Surging Power Demand
In December 2024, leadership at Grid Strategies published “Strategic Industries Surging: Driving US Power Demand.” The 2024 report represents a striking escalation in load growth projections compared to the findings of Grid Strategis’ December 2023 report titled, “The Era of Flat Power Demand is Over.” The earlier report already identified a shift away from flat power demand, noting that grid planners had nearly doubled the 5-year growth forecast from 2.6% to 4.7%, with a projected peak demand growth of 38 GW by 2028. Key drivers included a $630 billion investment surge in large-scale projects like data centers, industrial facilities, and electrification of buildings and transportation.
However, the 2024 report significantly amplifies these expectations. It highlights a five-fold increase in the 5-year load growth forecast, projecting a cumulative increase of 128 GW by 2029. This growth marks a dramatic departure from the historical norm of sub-1% annual demand increases, now transitioning to sustained growth rates averaging 3% annually.
The updated report attributes this sharp rise to the acceleration of strategic industries, including data centers, fueled by artificial intelligence demands, and the electrification of transportation and buildings. Federal incentives, such as those provided under the CHIPS Act and the Inflation Reduction Act, have catalyzed rapid expansions in manufacturing and green technology sectors, particularly in semiconductors, batteries, and hydrogen fuel production.
Despite the opportunities, the challenges have also grown more dire since 2023. The new report underscores the insufficient pace of grid development, with high-voltage transmission line additions declining to a mere 55 miles in 2023. It warns of severe risks to economic competitiveness and reliability if the U.S. fails to accelerate infrastructure deployment. The 2024 report also calls for immediate reforms in regulatory processes, streamlined permitting, and a greater emphasis on interregional transmission, which could reduce costs and enhance efficiency in meeting the burgeoning demand.
This dramatic upward revision in electricity demand between 2023 and 2024 underscores the urgency of preparing the electric grid for an unprecedented era of growth. The shift is not just a continuation but a substantial acceleration of trends noted in the previous report, demanding an intensified focus on grid scalability and resilience to secure the nation’s economic, environmental, and energy goals.
Over the past two years, the 5-year load growth forecast has increased by almost a factor of five, from 23 GW to 128 GW, including Grid Strategies’ estimate of recent update reports.
