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Faster-than-Expected Data Center Load Growth May Cause Increased Regional Short-term Fossil Fuel Generation and Wholesale Electricity Prices

LCG, March 18, 2026--The EIA released a new "In-depth Analysis" of the potential impact of faster-than-expected near-term growth in data center power demand on power generation and wholesale prices on March 12. The analysis models the lower 48 states through 2027 and compares results to its base case scenario. Key takeaway from this sensitivity analysis is the potential increase in fossil fuels in some regions and potentially a significant increase in wholesale prices in ERCOT.

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Faster-than-Expected Data Center Load Growth May Cause Increased Regional Short-term Fossil Fuel Generation and Wholesale Electricity Prices

LCG, March 18, 2026--The EIA released a new "In-depth Analysis" of the potential impact of faster-than-expected near-term growth in data center power demand on power generation and wholesale prices on March 12. The analysis models the lower 48 states through 2027 and compares results to its base case scenario. Key takeaway from this sensitivity analysis is the potential increase in fossil fuels in some regions and potentially a significant increase in wholesale prices in ERCOT.

Read more

Industry News

Cal-ISO Calls 'Stage 2' Power Emergency for Third Day

LCG, Nov. 16, 2000--The California Independent System Operator yesterday declared a "Stage 2" power emergency, forcing the state's utilities to shed load for the third straight day. The ISO said it would need customers with interruptible service contracts to reduce demand by 1,400 megawatts late yesterday afternoon.

All summer, Cal-ISO scrambled to find 44,000 megawatts of power and this week it is having trouble coming up with 33,000 megawatts because about 12,000 megawatts worth of power plants are shut down for maintenance and repair after running non-stop for several months.

The problem was exacerbated by a cold snap early this week that boosted demand by customers who use electricity for heat. The cold weather also affected the Pacific Northwest, reducing the amount of power that was available for import to California.

In addition, at this time of the year the streams of the Sierra Nevadas are nearly dry, reducing the amount of hydroelectric power available in the state.

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