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US Electricity Demand to Rise 39% by 2035 as Grid Constraints Persist, ICF Says

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US electricity demand will increase 39% by 2035, but grid capacity and infrastructure constraints will determine where new power loads can connect, ICF International said in a Thursday report.

The firm expects peak electricity demand to rise 25% by 2035 from 2026 levels, driven by expanding data centers, industrial growth and electrification. It said the outlook varies significantly across regional power markets.

ICF projects electricity demand in the PJM market will grow 43% by 2035, compared with a 14.3% increase in the New York Independent System Operator region during the same period.

The report said shrinking reserve margins are raising reliability concerns. ICF estimates the US has only about 26 GW of excess generating capacity above minimum resource adequacy requirements.

ICF forecasts 445 GW of new US generation capacity additions between 2026 and 2030. However, it said generation, transmission and distribution projects often take years to permit, finance, interconnect and construct.

The firm said timing, rather than the availability of new resources, remains the biggest challenge because many large electricity users need power before new infrastructure is ready.

ICF said utilities and transmission planners should better align resource adequacy, transmission capability, distribution capacity and demand-side resources with the location and timing of new electricity demand.

The report said developers and investors can improve project viability through earlier coordination on generation, energy storage, grid conditions, project timing and customer load flexibility.

ICF said demand-side resources will play a growing role in managing peak demand and supporting grid reliability where infrastructure constraints delay new generation and transmission projects.

States can strengthen economic competitiveness through better grid planning, while federal agencies can help speed project delivery by improving permitting, financing, supply chains, workforce development and coordination, according to ICF.

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