As we approach the end of the 2024, it is fitting that electricity demand growth has gotten another huge upward revision. According to new analysis from Grid Strategies, a leading power sector consulting firm, U.S. electricity demand could jump an astonishing 128 gigawatts (GW) over just the next five years driven largely by the data center and manufacturing boom. The new estimate represents a five-fold increase in power demand growth forecasts over just the past two years.

Data center demand “is the single largest component of growth in utility load forecasts,” Grid Strategies said. It will be highly concentrated in just a few areas, including near Dallas, Northern Virginia, Pennsylvania and near metro Atlanta. In the Electric Reliability Council of Texas’ and PJM Interconnection’s service territory alone, power demand is projected to jump 73 GW by 2029—the power demand equivalent to what is needed for 50 million homes.

McKinsey, a leading international consultancy, recently estimated that U.S. data center demand could reach 83 GW or 606 terawatt hours of electricity in 2030, an extraordinary four-fold revision from their analysis in 2023. Based now on analysis of what grid operators and utilities see coming, that estimate appears to be right on target.

The arithmetic of the energy transition is getting upended on a nearly monthly basis. There is no planning horizon for what is coming, for the demand that is already being baked in as hyperscale data centers rise far faster than new energy infrastructure to serve them.

Very Simple Math Problem

The idea that a few retired nuclear power plants or a new class of unproven small modular reactors that only exist on paper could meet this demand is a fantasy. Renewables aren’t the answer either. Even if they could come online at the scale and pace needed – a huge if – renewable energy additions don’t provide the around-the-clock, firm generation needed for data centers. Even measures such as PJM’s proposal to have new natural gas plants jump to the front of the interconnection queue to support reliability appear far too little too late to meet the speed and scale of what’s on the horizon. Then there’s the towering enabling infrastructure hurdle.

Building and siting essential interstate transmission lines and natural gas pipelines in a timely manner has proven to be all but impossible. Despite the urgent need for thousands of miles of new high-voltage interstate transmission additions each year, just 55 miles of high-voltage transmission were added nationally in 2023.

North American Electric Reliability Corp. CEO Jim Robb recently said, “We have a very simple math problem: the trend lines for electricity supply and demand are moving in the wrong direction to sustain reliability.”

The case for preserving the coal fleet as a reliability bridge has never been so clear. The grid desperately needs generating capacity, and dispatchable, fuel-secure capacity at that. We have that capacity already built and operating.

The Biden administration and too many state governments have ignored on-the-ground reality for far too long. They’ve buried their collective heads in the sand about the immense reliability challenges facing the nation’s power supply and the urgency to preserve, not push aside, the nation’s remaining coal fleet to buttress reliability efforts, counter electricity-driven inflation and ensure we have the power needed to enable the extraordinary economic opportunities now at our doorstep.

The power demand surge is here. It’s immediate and as real as cement and steel in the ground. If trend lines are any indication, demand – and the immediacy of its arrival – will only accelerate. We desperately need pragmatic policy to meet it and that begins with reembracing an all-of-the-above energy strategy.