ENERGY SECURITYThe US Doesn’t Need to Generate as Much New Electricity as You Think
Load shifting and improving energy efficiency could reduce the need for new power plants, but utilities often profit more from building than saving power.
The conversation around energy use in the United States has become … electric. Everyone from President Donald Trump to the cohosts of Today show has been talking about the surging demand for, and rising costs of, electrons. Many people worry that utilities won’t be able to produce enough power. But a report released today argues that the better question is: Can we use what utilities already produce more efficiently in order to absorb the coming surge?
“A lot of folks have been looking at this from the perspective of, Do we need more supply-side resources and gas plants?” said Mike Specian, utilities manager with the nonprofit American Council for an Energy-Efficient Economy, or ACEEE, who wrote the report. “We found that there is a lack of discussion of demand-side measures.”
When Specian dug into the data, he discovered that implementing energy-efficiency measures and shifting electricity usage to lower-demand times are two of the fastest and cheapest ways of meeting growing thirst for electricity. These moves could help meet much, if not all, of the nation’s projected load growth. Moreover, they would cost only half — or less — what building out new infrastructure would, while avoiding the emissions those operations would bring. But Specian also found that governments could be doing more to incentivize utilities to take advantage of these demand-side gains.
“Energy efficiency and flexibility are still a massive untapped resource in the U.S.,” he said. “As we get to higher levels of electrification, it’s going to become increasingly important.”
The report estimated that by 2040, utility-driven efficiency programs could cut usage by about 8 percent, or around 70 gigawatts, and that making those cuts currently costs around $20.70 per megawatt. The cheapest gas-fired power plants now start at about $45 per kilowatt generated. While the cost of load shifting is harder to pin down, the report estimates moving electricity use away from peak hours — often through time-of-use pricing, smart devices, or utility controls — to times when the grid is less strained and power is cheaper could save another 60 to 200 gigawatts of power by 2035. That alone would far outweigh even the most aggressive near-term projections for data center capacity growth.
