When rural electric cooperatives first strung power lines from farm to farm, across arroyos, and through remote forests less than a century ago, most members had but a handful of light bulbs to power. With time, they added appliances like refrigerators, but we’re sure they couldn’t begin to imagine the number and variety of electrical devices in today’s homes and garages.
Across the U.S., people use a growing amount of electricity at work, at home, and with the growth of electric vehicles (EVs), even on the road.
The demand for electricity increased by 2.5% in 2024 and is expected to grow by 3.2% this year. That was after co-ops saw a 4.8% increase in 2022. Through 2029, the nation’s peak demand is projected to grow by 38 gigawatts. That would be like adding another California-sized state to our nation’s power grid.
The rapid growth of artificial intelligence (AI) is driving the development of massive data center facilities, often placed in electric co-op service territories to take advantage of inexpensive land and fewer neighbors to complain. By 2022, these facilities accounted for 2.5% of the nation’s consumption of electricity––and by 2030, they’ll use 7.5% of all electric power.
Data centers and facilities like warehouses require a large, steady supply of electricity 24 hours a day. That means the electric co-ops supplying them can’t rely on intermittent sources of electricity such as solar or wind energy to handle the additional load. Instead, they need more of what’s known as baseload or always-available power, much of which is currently generated by burning fossil fuels. The more we depend on technology, the more we’ll need reliable baseload generation.
Yet that’s a problem, because at the same time Americans are using more electricity, power providers are being forced to shut down reliable sources of baseload power such as coal and nuclear power plants. Many large coal plants have been converted to use cleaner-burning natural gas, but others have been deemed too costly to convert and are prematurely being shut down. More than 110 gigawatts of always-available generation—enough to power about 35 million homes—is forecast to retire by 2033.
The U.S. Energy Information Administration’s forecast expects coal-fired generation to drop to half of today’s levels by 2030. Renewable energy will capture a growing share of the supply, but as noted, much renewable energy is not reliable enough to provide baseload power.
As electricity powers a growing share of life’s tools and conveniences, overall demand is expected to continue its steady growth through 2050. A great example is the efficiency of electric heat pumps. Federal and other subsidies and tax advantages are powering significant growth in their share of the home heating market.
In other words, at the same time everyone is using more electricity than ever, the supply of the most reliable source is drying up. Add in the uncertainty created by public policy debates around energy and climate change, and you can begin to understand why 19 states face a high risk of rolling blackouts between now and 2028.
The energy industry studies demand closely because construction of all types of generation is costly and lengthy––often longer than a decade from groundbreaking to entering service.
As renewables become more efficient and cheaper to produce, their share of the power mix will only continue to grow. Someday soon, battery technology may reach the point where large-scale storage of renewable generation becomes possible, but until then, we’ll need more of those always-available power sources.
One more factor plays a key role in the ability of co-ops and the rest of the nation’s power industry to keep up with demand. That’s the supply chain, in which too few U.S. suppliers simply can’t keep up with the nation’s needs for power equipment. When a co-op orders new transformers, it may have to wait two years or more for delivery and pay a significantly higher price.
Photo courtesy Mandiri Abadi, Pexels
Expect to hear more about the challenges created by record demand for electricity in the coming years. In part two of this article, we’ll examine some of the innovative ways electric co-ops are managing and preparing for demand.ν
For more than four decades, business writer Scott Flood has worked with electric cooperatives to build knowledge of energy-related issues among directors, staff and members. Scott writes on a variety of energy-related topics for the National Rural Electric Cooperative Association, the national trade association representing nearly 900 electric co-ops.
