U.S. power generation and electricity demand have risen this year to the highest in at least three years but the 2024 demand likely peaked in July amid peak air conditioning and cooling consumption, Reuters columnist Gavin Maguire reports, citing data from LSEG.
U.S. power generation in the Lower 48 states rose by 3.4% between January 1 and August 26 compared to the same period of 2023, according to the LSEG data. The total generation of 115 million megawatt hours (MWh) was also the highest power the Lower 48 has generated since at least 2021, Maguire notes.
However, following the July summer heat and air conditioning demand, U.S. generation and electricity use have shown signs of dropping in August, suggesting that July was the peak month for power generation and consumption in America, according to Maguire.
Last month, the International Energy Agency (IEA) said that economic growth, higher demand for cooling amid heat waves, the rapid rise of data centers, and continued electrification are set to push the growth in global electricity demand to one of the highest paces in the past 20 years in 2024 and 2025.
Regionally, electricity demand in the United States is set to rebound significantly in 2024, rising by 3% year-on-year, thanks to an improved economic outlook, rising demand for air conditioning, and the surge in data center expansions. U.S. power demand is forecast to rise by 1.9% in 2025, the IEA said in its Electricity Mid-Year Update report in July.
Some of the biggest U.S. utilities have bumped up their forecasts for short and long-term demand growth and peak demand and are planning higher spending to meet rising consumption.
The expected surge in power demand due to data centers working with AI is putting pressure on utilities to invest more in updating the infrastructure and meeting higher peak demand levels than what companies and regulators were forecasting just two years ago.
By Tsvetana Paraskova for Oilprice.com
