The stability of North America’s electrical infrastructure faces unprecedented challenges as artificial intelligence and data centres drive power consumption to historic levels, according to a stark warning from the industry watchdog NERC.
The North American Electric Reliability Corporation’s latest assessment reveals critical reliability issues emerging across the US and Canadian power grids, with demand growth outpacing generation capacity at rates unseen in twenty years. The watchdog projects peak summer demand will climb by 132 gigawatts (15 per cent) over the next decade, whilst winter demand is expected to surge by 149 gigawatts (18 per cent).
These projections mark a significant increase from previous forecasts, driven primarily by the rapid expansion of data centres supporting AI operations and cryptocurrency mining activities. The situation is compounded by increasing adoption of electric vehicles and heat pumps among consumers.
The International Energy Agency’s estimates paint an equally concerning picture, suggesting global data centre power requirements could exceed 1,000 terawatt hours by 2026 – doubling 2022 levels and matching Germany’s entire electrical consumption.
The mounting pressure on the grid coincides with the planned decommissioning of 115 gigawatts of fossil fuel generation capacity over the next decade. This reduction in traditional power sources threatens to push supply buffers below critical levels across nearly all jurisdictions, with the US Midwest potentially facing shortfalls as early as next year.
While major technology companies are actively seeking solutions, including significant investments in nuclear power generation, the pace of renewable energy infrastructure development and battery storage implementation continues to lag behind the explosive growth in demand. The situation presents a critical challenge for grid operators and policymakers as they navigate the delicate balance between supporting technological advancement and maintaining reliable power supply.
Post Disclaimer
The following content has been published by Stockmark.IT. All information utilised in the creation of this communication has been gathered from publicly available sources that we consider reliable. Nevertheless, we cannot guarantee the accuracy or completeness of this communication.
This communication is intended solely for informational purposes and should not be construed as an offer, recommendation, solicitation, inducement, or invitation by or on behalf of the Company or any affiliates to engage in any investment activities. The opinions and views expressed by the authors are their own and do not necessarily reflect those of the Company, its affiliates, or any other third party.
The services and products mentioned in this communication may not be suitable for all recipients, by continuing to read this website and its content you agree to the terms of this disclaimer.