Released on January 29, the North American Electric Reliability Corporation’s (NERC’s) “2025 Long-Term Reliability Assessment” spotlights intensifying resource adequacy risks throughout the North American bulk power system (BPS) over the next ten years:

– Summer peak demand is forecast to grow by 224 GW, a more than 69 percent increase over the 2024 LTRA forecast, with new data centers for artificial intelligence and the digital economy accounting for most of the projected increase.

– Winter demand growth continues to outpace summer demand growth with 246 GW of growth forecast over the next ten years, reflecting the evolution of electricity usage.

Uncertainty and lag in the pace of new resource additions are driving heightened concerns that industry will not be able to keep up with rapidly increasing demand.

(Undertaken annually in coordination with the Regional Entities, NERC’s 2025 LTRA is the Electric Reliability Organization’s independent assessment and comprehensive report on the adequacy of planned BPS resources to reliably meet the electricity demand across North America over the next ten years. The 2025 LTRA includes a probabilistic assessment and the use of energy risk metrics to identify potential supply shortfalls.)

“This assessment is not a prediction of failure but an early warning on the trajectory of risk,” said John Moura, NERC’s director of Reliability Assessment and Performance Analysis. “The path forward is still manageable but only if planned resources come online and on time.”

The risk of electricity supply shortfalls is increasing during winter conditions, as generators with diverse fuels retire and are replaced predominantly by solar and batteries and natural-gas-fired generators. This trend in resource additions is reflected in the 2025 LTRA, which finds that new battery resource projects have grown to match solar projections. In addition, natural-gas-fired generator additions represent 15 percent of the projected capacity additions, followed by wind and hybrid at eight percent each. While interconnection queues continue to grow, considerable uncertainty surrounds the timing and amount of resource additions.

“As these concerns have grown more acute, more action has been taken by industry and regulators to bolster resources,” said Mark Olson, NERC’s manager of Reliability Assessments. “Although projected retirements remain high, with 105 GW of peak seasonal capacity planned for retirement over the next ten years, this number has reduced by 10 GW since the previous LTRA. In addition, market mechanisms such as capacity accreditation have been launched, more precisely highlighting the loss-of-load risks posed by a generation mix that has increasing amounts of variable resources. Also, industry is reacting to the changing conditions with growing demand and evolving planning methods that highlight the potential need to keep resources on-line longer than previously anticipated.”

To mitigate the reliability challenges over the next ten years, NERC recommends streamlining infrastructure development (both gas and electric), managing generator deactivations, undertaking robust adequacy assessments, and coordinating electric-natural gas system planning and operations. Specific recommendations include the following:

– Integrated Resource Planners, market operators, and regulators should expedite new resources to meet growing demand and carefully manage generator deactivations.

– NERC, industry, and regulators should understand and manage reliability risks accompanying large-load growth and leverage potential capabilities in new types of loads to provide flexibility to operators during times of grid stress.

– NERC, the Regional Entities, and industry should improve the LTRA by incorporating wide-area analysis, risk scenarios, and criteria to inform stakeholders of future reliability risks.

– Regulators and policymakers should streamline siting and permitting processes to remove barriers to resource and transmission development.

– Regional Transmission Organizations, Independent System Operators, and the Federal Energy Regulatory Commission (FERC) should continue to ensure that essential reliability services are maintained.