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EIA Sees US Electricity Demand Climbing 3.1% in 2027 as Solar Capacity Expands

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The Energy Information Administration raised its projection for US electricity consumption in its May Short-Term Energy Outlook released on Tuesday.

"US electricity demand in our forecast rises 1.3% in 2026, averaging almost 4,250 billion kilowatthours and growing another 3.1% in 2027," according to the STEO.

This surge in demand is fueled by growth in the commercial sector, which is expected to surpass residential demand, a first on record, according to the EIA. Industrial demand is also surging, but at a relatively slower pace.

"Residential electricity prices are expected to increase by 5% in 2026 and to continue to rise in 2027, although at a slower pace," EIA said.

Prices are rising across the US, but the largest hikes are expected along the East Coast.

Additionally, the EIA also raised forecasts for utility-scale solar generation.

"Our forecast for utility-scale solar generation in 2026 is 1.4% higher than in the previous STEO because we revised our estimate of the amount of solar generating capacity that was online at the beginning of this year," the EIA said.

The EIA expects US solar capacity to increase to 180 gigawatts in 2026 from 150 GW in 2025 and reach 215 GW in 2027, while wind capacity will rise to 170 GW in 2026 from 159 GW in 2025.

US coal production will decline to 519 million short tons in 2026 from 528 million short tons in 2025 before falling further to 487 million short tons in 2027, the EIA forecast showed.

Coal inventories will rise 12% to 123 million short tons by the end of 2026 as domestic demand weakens faster than production declines, the agency said.

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