After decades of relatively flat electricity demand across the U.S., demand could increase by an average of 9% by 2028 while peak demand for electricity could increase by an average of 5% over the same period, a new report from consulting firm ICF said.
The report measures and maps electricity demand growth across the U.S. over the next four years and the potential costs to utilities.
“A robust American economy, building and transportation electrification, manufacturing of batteries and fuel cells, data centers, artificial intelligence, and cryptocurrency mining are all contributing to new electric demand that is stressing the electric grid,” ICF said.
Demand growth is expected in every region across the country, but the pace of growth will vary by region, according to ICF.
The largest increase by far is projected in the mid-Atlantic region, resulting from rapid building and vehicle electrification and demand from data centers. Demand in this region is projected to increase 68% by 2050, compared to the U.S. average of 57%.
“While new sources of electricity supply -- including utility-scale solar and wind power -- could theoretically meet this expected demand growth, there are significant challenges to getting these new sources built, including upgrading the electric grid, realistic timeframes for gaining approvals for new clean electricity projects, and finding suitable locations to build additional clean energy infrastructure.”
These challenges, combined with the electricity demand increase, could slow the transition to clean, reliable and affordable electricity, ICF said.
Specifically, the report finds that the cost many utilities pay for electricity could increase by an average of 19% by 2028. Much of the additional costs would be passed on to utility customers.
ICF’s report also outlines six key recommendations for utilities to meet these challenges and stay ahead of this growth, including how to establish sophisticated system planning processes, identify ideal locations for renewable energy projects, and consider new distribution grid upgrades.
Additionally, the report outlines how utilities can implement innovative customer programs that leverage artificial intelligence to automatically manage and optimize grid-edge technology—including rooftop solar, electric vehicle charging stations, battery energy storage and virtual power plants.
The report leveraged ICF’s proprietary, cloud-based renewable energy analytics platform EnergyInsite™ to measure and map electricity demand growth across the U.S. over time.
