The United States faces a significant energy crisis as demand for power skyrockets, raising concerns about exacerbating the climate crisis. After decades of stagnant or declining electricity demand, forecasts now indicate the need for substantial new energy infrastructure to meet growing needs, according to filings submitted to the Federal Energy Regulatory Commission and compiled by Grid Strategies.
Projections suggest that over the next five years, the nation will require approximately 34 new nuclear plants or 38 gigawatts of additional capacity to support various sectors such as data centers, manufacturing, and the electrification of buildings and vehicles. However, recent statements from utilities indicate an even greater need for power than previously anticipated.
For instance, Georgia Power, serving over 2.7 million customers, initially estimated the need for a single mid-sized power plant until the end of the decade. However, subsequent announcements indicate a demand surge equivalent to four new nuclear units, primarily driven by the proliferation of data centers and manufacturing facilities.
The national energy estimates do not fully account for the energy-intensive activities of cryptocurrency and cannabis farming, estimated to consume up to 2.3% and 1% of the country’s electricity, respectively. The soaring popularity of cryptocurrency and the legalization of marijuana have fueled substantial energy demand growth in these sectors.
Data mining, particularly in states like Texas, has become a significant driver of energy demand, with bitcoin and other crypto miners requiring the equivalent of approximately 41 new nuclear power plants to sustain their operations. The exponential growth of data centers, including those supporting cryptocurrency mining, has contributed to a global increase in power demand, with the International Energy Agency projecting a doubling of electricity needs for data centers by 2026.
In Virginia, Dominion Energy has expressed concerns about its ability to meet the escalating power demand driven by data centers. The utility has warned of a 376% increase in demand by 2038, driven not only by data centers but also by the transition to electric appliances, heating, cooling systems, and vehicles.
Similarly, the Tennessee Valley Authority (TVA) has experienced a surge in demand due to data centers, accounting for 65% of load growth since 2019. The TVA expects further electricity demand increases of 40% to 50% from planned data center expansions and has proposed the construction of eight new natural gas plants to meet this demand.
Amidst this rapid growth, concerns are mounting regarding the climate implications of relying on fossil fuels for energy generation. The expansion of natural gas plants and the delay in transitioning away from coal-fired plants could undermine efforts to reduce greenhouse gas emissions and achieve climate goals. Despite calls from clean energy advocates for prioritizing renewable energy sources, utilities cite cost-effectiveness and expediency as reasons for favoring natural gas plants.
However, critics argue that utilities should have better anticipated this surge in demand and invested in renewable energy infrastructure. The lack of adequate transmission lines for transporting wind and solar power further complicates the transition to clean energy sources.
As the US strives to reduce greenhouse gas emissions and transition to carbon-free electricity by 2035, the current energy landscape underscores the urgent need for strategic planning and investment in sustainable energy solutions to address growing demand while mitigating climate impact.