US utilities have committed or begun construction on 116 gigawatts (GW) of large load capacity, equivalent to 15.5 percent of current US peak demand, according to a new study by Wood Mackenzie of major investor-owned utilities. Including projects in advanced discussion or near-term forecasts, the total rises to 147 GW, or 20 percent of peak demand.

The report, No turning back, an analysis of utility large load pipelines, finds that a significant portion of this capacity will come online this decade, with 60 GW expected by 2030, equal to 8 percent of current peak demand. Utilities expect 93 GW to be operational by 2035, after which little additional pipeline capacity has been disclosed.

"Utilities are committing to large loads ramping rapidly this decade," said Ben Hertz-Shargel, global head of Grid Edge for Wood Mackenzie. "The market will be hard-pressed to supply this new load on that timeframe, which may prevent it from happening.”

Market Shift Toward Deregulated Areas

The report highlights a shift in where large load projects are located. While 91 percent of the 17 GW currently under construction is in regulated markets, 54 percent of committed capacity not yet under construction and 65 percent of capacity in advanced discussion is planned for deregulated markets. Nearly three-quarters of high-confidence load is concentrated in ERCOT and PJM regions.

"Committed capacity not under construction as well as advanced discussion capacity fall disproportionately in deregulated markets, primarily ERCOT," Hertz-Shargel said. "Deregulated markets pose risks of inadequate future supply and price increases to non-large load customers, which has prompted market interventions by Texas and PJM and will likely prompt more in the future."

Pipeline Uncertainty Increasing

Despite modest increases in high-confidence capacity at some utilities, its share of total pipeline capacity has decreased in recent quarters as new requests outpace the advancement and withdrawal of existing projects. "Rather than starting to see a trend toward pipeline certainty, we continue to observe the opposite," Hertz-Shargel said.

Data center ramp rates are contributing to this uncertainty. Projects over 300 MW often take much longer than four years to reach contract capacity.

"The pace at which utilities connect data centers is just part of the story," Hertz-Shargel said. "How soon the grid actually sees load will ultimately depend on data center developers."