The risk of energy shortfall is real. Policy solutions exist.

By Jim Matheson

This is a lightly edited excerpt of testimony provided during the recent Congressional energy subcommittee hearing, “Assuring Abundant, Reliable American Energy to Power Innovation.”

America's electric cooperatives (co-ops) comprise a unique sector of the electric industry. These not-for-profit entities are owned and governed by the people they serve. Electric co-ops are motivated by people, not profits. From growing exurban regions to remote farming communities, electric co-ops provide power to 42 million Americans across 48 states and serve 92% of the nation’s persistent poverty counties. 

All electric co-ops share an obligation to serve their members by providing reliable and affordable power. This obligation is not without challenges. Electric co-ops serve 56% of the landmass in the United States – the country’s most rural, rugged and hard-to-reach areas – that is primarily residential and typically sparsely populated. These characteristics make it comparatively more expensive for electric co-ops to operate than the rest of the electric sector, which tends to serve more compact, industrialized, and densely populated areas. This means coops are constantly asked to do more with less, and they deliver.

A resilient and reliable electric grid that keeps the lights on at a price families and businesses can afford is the cornerstone of American energy security and our national economy. A diverse portfolio of energy resources is essential to this commitment and critical to meet skyrocketing electricity demand, particularly in rural communities. To ensure reliability, that portfolio must be anchored by dispatchable, or always available, power generation. 

Electricity demand is surging, driven by growing communities, electrification of the economy, artificial intelligence and power-hungry data centers, and new manufacturing plants. According to the North American Electric Reliability Corporation (NERC), electric demand growth is the highest it has been in over two decades. Over the next 10 years, peak power needs are expected to rise by over 18% and newly announced projects, including data centers, are driving that demand even higher. Some forecasts predict data centers will consume 9% of all U.S. electricity generation by 2030.

At the same time, critical, always available generation resources are being retired faster than they can be reliably replaced. Over 50,000 megawatts (MW) of baseload coal, natural gas and nuclear capacity is currently slated for retirement over the next 10 years. A certain amount of new generation – notably natural gas and renewable projects – will be built to replace some of these retirements.

These diverging trends threaten grid reliability. As a result, over half of North America is at risk of energy shortfalls in the next 10 years amid surging electricity demand and thermal plant retirements.

The National Rural Electric Cooperative Association (NRECA) offers the following insights and recommendations for consideration as Congress evaluates legislation to address the mounting issues facing the electric grid.

Read more here.

Jim Matheson is the chief executive officer of the National Rural Electric Cooperative Association.

_{^{*The opinions expressed in this column are those of the author and do not necessarily reflect the views of EnergyPlatform.News.}}