Around half of the United States may experience power shortages in the next decade, potentially leading to power failures and the implementation of conservation measures, non-profit organization North American Electric Reliability Corporation (NERC) said in its latest annual assessment on December 17.

The country is expected to see growing power demand from artificial intelligence data centers and the electrification of buildings and transportation sectors. This, coupled with lower-than-expected power generation growth, may exacerbate supply-demand imbalance, NERC said in its 2024 Long-Term Reliability Assessment.

The majority of the North American Bulk Power System (BPS) is experiencing significant resource adequacy challenges over the next decade, NERC said. 

Notably, there would be generator retirements totaling 78 GW over ten years, and another 37 GW announced plans for retirement through 2034. This, alongside sluggish renewable energy growth, present critical reliability issues.

Electricity peak demand and energy growth forecasts are increasing, surpassing growth rates observed in the last twenty years. The aggregated assessment area summer peak demand is projected to rise by over 132 GW, and winter peak demand forecasts are increasing by 149 GW, reflecting a sharp upward trend since the 2022 Long-Term Reliability Assessment and reversing an almost two-decade trend of falling or flat growth rates, the latest assessment showed.

The ongoing electrification of household systems, such as heat pumps, coupled with the rapid growth of electric vehicle adoption, are also major drivers of this demand increase, according to NERC.

While transmission development is on the rise, it faces significant siting and permitting hurdles, it noted.

The NERC recommends strategies such as integrated resource planning, effective management of generator deactivations, streamlined permitting processes, and addressing the needs of the natural gas-electric system.