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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

Connecticut Attorney General Outraged Over FERC Locational ICAP

LCG, November 18, 2004--Reaching a solution for Connecticut's wholesale electricity market and related reliability problems is a challenging task. The Federal Energy Regulatory Commission (FERC) and ISO New England (ISO-NE) plan to implement a locational capacity market that includes two capacity regions in Connecticut, one region for Maine, one for eastern Massachusetts and one for the rest of New England. In the near term, it is expected that higher capacity prices would be paid to generators in the southwestern corner of Connecticut to attract new generation to resolve the localized shortfall. "This two-zone decision divides Connecticut against itself and is an outrage," said Connecticut Attorney General Richard Blumenthal, who plans to try and reverse the ruling. A final decision is anticipated by June 2005, with implementation targeted for January 2006.

On Tuesday, Governor M. Jodi Rell also expressed his opposition to the ruling. It's painfully obvious that the real problem in southwestern Connecticut is the capacity of the existing network to carry power, not the lack of power generation," said Rell.

Transmission studies to resolve Connecticut's problems have been underway for some time. One plan for southwest Connecticut is focused on running the last 24 miles of the Middletown-Norwalk line underground into Norwalk. The underground design is desired by the City of Norwalk and its residents. The technical staff from ISO New England, Connecticut Light & Power and United Illuminating Company have struggled to develop an underground solution that is technically acceptable from a reliability standpoint and is continuing to evaluate alternatives.

A related, key issue is who pays the incremental costs - estimated to be at least $250 million - for underground rather than above ground cables. In a previous filing, ISO-NE cautioned that the increased costs are unlikely to qualify for regional cost support and that Connecticut residents and businesses may be responsible for such costs. Who pays and how quickly an upgrade project is completed is difficult to determine, especially when one considers Connecticut's track record with another controversial transmission project, the Cross Sound Cable.

In a statement released yesterday, ISO-NE President and Chief Executive Officer Gordon van Welie stated, "[T]here are no cheap fixes for Connecticut's energy dilemma. Whatever option is chosen, it's time to move forward."

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