A new study of future electricity needs and the ability of the nation’s electric grids to produce the power showed an “elevated” energy risk for the Southwest Power Pool which controls electrical output in Oklahoma and 13 other states.
But the report by the North American Electric Reliability Corporation said ERCOT, the grid serving Texas was in worse shape and faced a “high risk” level in the next four years.
“The overall resource adequacy outlook for the North American BPS (bulk power system) is worsening,” declared the study. It found that 13 of 23 assessment areas face resource adequacy challenges over the next 10 years.
“Projections for resource and transmission growth lag what is needed to support new data centers and other large loads that drive escalating demand forecasts. Most new resources in development to come on-line in the next five years consist of battery storage and solar photovoltaic (PV), which are
inverter-based and weather-dependent resources that increase the complexity of planning and operating a reliable grid,” continued the report.
Adding to the challenge is the looming retirement of more fossil-fired generator units in the coming five years. The study raised suspicions about the ability of renewable energy to supply the demanded power.
“The continuing shift in the resource mix toward weather-dependent resources and less fuel diversity increases risks of supply shortfalls during winter months,” it stated.
As a result, the report explained that market operators and regulators face “more uncertainty” and it will only add to the “already-complex endeavor of planning for resource adequacy during this period of rapid grid transformation.”
The report said the SPP will be at elevated risk during the coming years.
“Demand forecasts outpace resource additions, leading to falling reserve margins. Scenarios with low wind and high generator forced outages identify energy shortfall risks.”
ERCOT, the grid that serves most of Texas faces far more serious challenges, according to NERC.
“The Texas RE-ERCOT assessment area is forecast to experience continued rapid electric demand growth over the next 5–7 years. ERCOT forecasts summer peak total internal demand to increase from 94,650 MW for 2026 to 154,077 MW for 2035, an average annual increase of 5.6%. This load growth is mainly driven by forecasted interconnections of large loads totaling 45 GW by 2030, of which 23 GW are data centers.”
The advancement of the use of more natural gas to power electric generator was observed in the report, stating many of the grids have become “increasingly reliant on natural gas for fuel” as new natural-gas-fired generators are added to the grids. It found 13 of the 23 assessment areas are adding capacity to their fleet of natural-gas-fired power plants over the next 10 years.
But it also had words of caution.
” As new natural-gas-fired generators progress through interconnection processes, Generator Owners, grid planners, and natural gas infrastructure developers need to take steps to ensure that regional natural gas infrastructure can reliably serve the needs of BPS generators.”
Adding to the demand for more electrical power in the next few years are data centers and it did not escape the attention of the NERC report.
“New data centers for artificial intelligence and the digital economy account for most of the projected increase in North American electricity demand over the next 10 years. These and other large commercial and industrial loads are connecting rapidly to the BPS. The emerging large loads present unique challenges to forecasting and planning for increased demand.
Load forecasts collected by NERC for the 2025 LTRA reveal the massive build-out of data centers in many parts of North America. Texas, PJM, and the WECC assessment areas are reporting steep
demand increases due primarily to new data centers and large loads. BAs within WECC reported that planned data centers account for an average of 10% of demand, with some BAs reporting as high as 40% of the demand forecast.”
In response to the report, Michelle Bloodworth, president and CEO of America’s Power, a national trade organization supporting the use of coal, called the study “another sobering wakeup call for energy officials and electricity consumers.”
She said the US Energy Department and the Federal Energy Regulatory Commission have warned the country for years about the risk of blackouts.
“Yet the risk keeps increasing. For the first time, families and businesses in half the U.S. face a high risk of blackouts. One of the primary reasons for this dangerous situation is the premature retirement of coal power plants. Another is the rapid growth of energy-intensive data centers.”
She said more than a fourth of the nation’s coal power plants will be retired over the next five years.
“Most of these retiring coal plants are located in high-risk regions. Unless these retirement plans are reversed, the grid will lose an energy-secure, affordable, and reliable source of baseload power. Coal power plants have been critical to keeping the lights on during Winter Storm Fern, just as they have during past winter storms. According to the U.S. Energy Information Administration, coal power plants increased their electricity production during Fern more than any other source of electricity.”