U.S. Power Plant Proposals Surge by 90% as Electricity Demand Rises

Proposals for new power generation capacity in the United States have increased by an impressive 90% over the last three years, Bloomberg has reported, in anticipation of a surge in demand for electricity.
Notably, some 80% of the proposed capacity is solar plus batteries, with only 3% of proposed power plants to run on natural gas or coal. The total proposed capacity stands at close to 2,600 GW, according to the data, which comes from the Lawrence Berkeley National Laboratory.
This does not mean, of course, that all of this proposed capacity will end up getting built. In fact, historical data suggests that only a fifth of all proposed projects do get completed. At the same time, demand for electricity in the country is set for a significant increase, driven by data center proliferation and the incorporation of artificial intelligence and more and more software applications.
Reuters reported earlier this week that U.S. power utilities were revising their demand estimates radically from only a few months ago. The report said that nine out of the top power suppliers in the country had raised their capital expenditure plans and demand projections.
“The truth of the matter is these things (data centers) are pigs when it comes to energy use, and now they’re the size of an elephant,” Eric Woodell, founder of software service provider Amerruss, told Reuters.
Woodell then said in a LinkedIn post on the Reuters report that “The gap between power production and demand will continue to grow, leading to shortages (brownouts or blackouts) happening more frequently. These events will test your data center infrastructure, whether you like it or not, whether you own or lease.”
The planned electrification of the transport sector will also help—if it materializes, that is. The EV push has slowed down recently and whether it would pick up again or not is an open question for the time being. Yet the surge in electricity demand from the IT sector may well be enough to prompt more capacity additions than normal.

About Parvin Faghfouri Azar

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