The Electric Reliability Council of Texas (ERCOT) is projecting an explosion in energy demand over the next five years, with peak electricity use more than doubling as new data centers come online around the state.
ERCOT this week updated its projections to show peak electricity demand as high as 218 gigawatts in 2031. The current power demand record, set in August 2023, was 85.5 gigawatts.
Energy-hungry data centers are driving the massive increases in ERCOT’s long-term estimate, accounting for a whopping 86 gigawatts of demand growth. That’s enough electricity to keep the lights on at 21.5 million homes.
ERCOT also downplayed the estimate, simultaneously releasing an adjusted estimate that showed power demand would grow, but at a significantly reduced pace. It showed demand hitting 145 gigawatts in 2031, 33 percent lower.
“Large load is coming,” energy analyst Doug Lewin said. “We don’t know what that number is going to be. Some of the numbers that are reported are a little crazy, but don’t lose the signal from the noise. We’re going to have robust load growth, and that means we are going to need a lot of new energy resources.”
A large part of the demand estimate comes from a law change in 2023 that required ERCOT to count all prospective large-scale power users in demand projections without fully vetting each project. Previously, ERCOT would not count projects in the early stages of development until certain financial commitments were made.
The ambiguity in ERCOT’s demand projections has led some state lawmakers to file legislation in hopes of getting more accurate demand forecasts. A Senate proposal passed in that chamber on March 19.
Companies are “getting in line, saying, ‘We’re going to build a data center or some other large load,’“ Sen. Phil King, R-Weatherford, said during a Senate meeting. “Well, you don’t know for sure that they’re for real, or are they just a speculator at this point?”
King noted that some data center projects consume more power than entire regions of Texas. Representatives of OpenAI’s data center project Stargate, an Abilene facility under construction that was touted by the White House in January, could use as much as 6 gigawatts of electricity.
“That one group of tilt-wall warehouses full of computers in Abilene by 2030 will use almost twice as much of electricity as the entire Rio Grande Valley uses on any given day,” King said. “That’s a bunch of electricity.”
While ERCOT’s estimates might be inflated, it is the latest demand estimate that some lawmakers have found alarming. In February, the power grid operator reported that peak power demand could outstrip supply as early as 2027. Again, the culprit was data centers.
This latest report continued that trend and upped last year’s long-term demand estimates by about 37 percent.
Lewin said that the demand projections are likely unrealistic and outstrip the private sector’s capacity to build such power infrastructure in Texas.
“You can’t build supply to meet that kind of demand that fast,” he said. “It’s just, I don’t ever like to say impossible, but that’s about as damn near impossible as anything could be.”
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Data Centers Drive ERCOT’s Power Demand Forecast
“That one group of tilt-wall warehouses full of computers in Abilene by 2030 will use almost twice as much of electricity as the entire Rio Grande Valley uses on any given day,” said one state senator.
