Wood Mackenzie Power & Renewables’ Post

Flat demand is over across North American Power Markets! 📈 The coming demand acceleration poses challenges to grid reliability, load forecasting, and transmission planning not including financial implications in wholesale energy and congestion markets. One prime example of this is ‘Data Center Alley’ in PJM. The Dominion Hub has continued to see demand growth due to data center interconnections, which is a very different story than what has historically been the case, due to #energyefficiency and deindustrialization. The graphic provides hourly granularity for year-over-year summer growth in PJM South from 2019-2023. This clearly shows that summer load is growing not only during peak hours, at 12%, but also during historically non-critical off-peak hours at 19% over the timeframe. While this part of Northern Virginia has become the Data Center Capital of the World due to particularly appealing tax incentives, commercial and government demand - Wood Mackenzie expects this trend of data center and manufacturing demand growth to continue. We’re forecasting annual PJM load to grow by 6.9% over the next 5 years with a corresponding ~$4 wholesale energy price impact to West Hub. For more information on our PJM Summer Outlook and analyst-driven insights on expected demand growth in the ISO, get in touch: https://okt.to/LNKeo9

Flat demand is over across North American Power Markets! 📈 The coming demand acceleration poses challenges to grid reliability, load forecasting, and transmission planning not including financial implications in wholesale energy and congestion markets. One prime example of this is ‘Data Center Alley’ in PJM. The Dominion Hub has continued to see demand growth due to data center interconnections, which is a very different story than what has historically been the case, due to #energyefficiency and deindustrialization. The graphic provides hourly granularity for year-over-year summer growth in PJM South from 2019-2023. This clearly shows that summer load is growing not only during peak hours, at 12%, but also during historically non-critical off-peak hours at 19% over the timeframe. While this part of Northern Virginia has become the Data Center Capital of the World due to particularly appealing tax incentives, commercial and government demand - Wood Mackenzie expects this trend of data center and manufacturing demand growth to continue. We’re forecasting annual PJM load to grow by 6.9% over the next 5 years with a corresponding ~$4 wholesale energy price impact to West Hub. For more information on our PJM Summer Outlook and analyst-driven insights on expected demand growth in the ISO, get in touch: https://okt.to/kXB6S5

Flat demand is over across North American Power Markets! 📈 The coming demand acceleration poses challenges to grid reliability, load forecasting, and transmission planning not including financial implications in wholesale energy and congestion markets. One prime example of this is ‘Data Center Alley’ in PJM. The Dominion Hub has continued to see demand growth due to data center interconnections, which is a very different story than what has historically been the case, due to #energyefficiency and deindustrialization. The graphic provides hourly granularity for year-over-year summer growth in PJM South from 2019-2023. This clearly shows that summer load is growing not only during peak hours, at 12%, but also during historically non-critical off-peak hours at 19% over the timeframe. While this part of Northern Virginia has become the Data Center Capital of the World due to particularly appealing tax incentives, commercial and government demand - Wood Mackenzie expects this trend of data center and manufacturing demand growth to continue. We’re forecasting annual PJM load to grow by 6.9% over the next 5 years with a corresponding ~$4 wholesale energy price impact to West Hub. For more information on our PJM Summer Outlook and analyst-driven insights on expected demand growth in the ISO, get in touch: https://okt.to/hUMVNG

Flat demand is over across North American Power Markets! 📈 The coming demand acceleration poses challenges to grid reliability, load forecasting, and transmission planning not including financial implications in wholesale energy and congestion markets. One prime example of this is ‘Data Center Alley’ in PJM. The Dominion Hub has continued to see demand growth due to data center interconnections, which is a very different story than what has historically been the case, due to #energyefficiency and deindustrialization. The graphic provides hourly granularity for year-over-year summer growth in PJM South from 2019-2023. This clearly shows that summer load is growing not only during peak hours, at 12%, but also during historically non-critical off-peak hours at 19% over the timeframe. While this part of Northern Virginia has become the Data Center Capital of the World due to particularly appealing tax incentives, commercial and government demand - Wood Mackenzie expects this trend of data center and manufacturing demand growth to continue. We’re forecasting annual PJM load to grow by 6.9% over the next 5 years with a corresponding ~$4 wholesale energy price impact to West Hub. For more information on our PJM Summer Outlook and analyst-driven insights on expected demand growth in the ISO, get in touch: https://okt.to/1dwOaE

Flat demand is over across North American Power Markets! 📈 The coming demand acceleration poses challenges to grid reliability, load forecasting, and transmission planning not including financial implications in wholesale energy and congestion markets. One prime example of this is ‘Data Center Alley’ in PJM. The Dominion Hub has continued to see demand growth due to data center interconnections, which is a very different story than what has historically been the case, due to #energyefficiency and deindustrialization. The graphic provides hourly granularity for year-over-year summer growth in PJM South from 2019-2023. This clearly shows that summer load is growing not only during peak hours, at 12%, but also during historically non-critical off-peak hours at 19% over the timeframe. While this part of Northern Virginia has become the Data Center Capital of the World due to particularly appealing tax incentives, commercial and government demand - Wood Mackenzie expects this trend of data center and manufacturing demand growth to continue. We’re forecasting annual PJM load to grow by 6.9% over the next 5 years with a corresponding ~$4 wholesale energy price impact to West Hub. For more information on our PJM Summer Outlook and analyst-driven insights on expected demand growth in the ISO, get in touch: https://okt.to/dRkg2O #energy

Here's your weekly Americas short-term #power insight💡: What is driving elevated prices in #PJM? (hint: it's not the heat) Since earlier this month, PJM's most liquid hub, West Hub, has experienced elevated prices (>$400 on 7/16). The cause as determine by Wood Mackenzie's PJM analyst team is in part due to an emergency Conastone 500 transformer outage, located between Baltimore and Harford county, Maryland, driving congestion during some of the hottest days over the past 5 years. The outage which began on July 2nd, was initially scheduled to return to service over the evening on July 6th, has now been extended to December 31st. Such a long outage, in a critical area of PJM, likely indicates serious damage to the substation in the form of a fault or fire. With limited information available, Wood Mackenzie analysts question how realistic this timeline will be. Regardless of the exact timing of the return to service, the expectation is for this outage to be a long term concern for PJM and market stakeholders. Wood Mackenzie’s proprietary CongestionIQ and Lens Power platforms not only identified this outage, but also pinpointed trading nodes that have seen drastic swings in pricing as a result. For more information, please visit: https://okt.to/5Zl2sC

4-5% load growth used to be considered robust. Now, AEP (and others) are facing annual forecasts of double digit load growth from data centers while residential load growth has been slightly declining due to “inflation”. So, big data centers that make the Cloud and AI work require new T&D infrastructure that (today) all rate classes pay for…even with inflationary pressures on the home budgets. AEP has wisely challenged this. Regulators will need to study this closely. And, buried within this timely article is a comment about eliminating the Chevron Doctrine. Interim CEO Ben Fowke said the U.S. Supreme Court’s decision to eliminate the Chevron doctrine is “going to be helpful” in challenging Environmental Protection Agency coal ash, wastewater and other rules. “I guess all of the rules that have come out we’re going to challenge, and for good reason,” said Fowke. ALL of the agency rules? Is FERC included? Stay tuned on both issues! Thanks Mike

Except this statement is completely wrong. We DO have a generation issue, else why are we NOT retiring gas and coal as originally planned in Virginia? Why is PJM undertaking a multi state transmission proposal that connects to coal in West Virginia and fossil fuel gas in Maryland intended to feed the insatiable power appetite of Loudon's Data Center Alley? Misdirection and obfuscation are a recipe for disaster. "Over 90% of Virginia data centers are in Loudoun County, Prince William County and Fairfax County. Strong demand and supply constraints in Q1 caused vacancy in Northern Virginia to remain near a record low of 1.8%. Electricity rates in Northern Virginia remain steady, despite power availability headwinds. Information provided by Dominion Energy reveals that power availability issues are reflective of transmission and distribution issues, not power generation." https://lnkd.in/gqWFxKAn

The high demand for data centers across North America is driving up prices as the industry struggles with increasing costs, and persistent power supply challenges impede the expansion of the global data center market. As public cloud providers continue dominating Silicon Valley, smaller facilities are struggling to meet the standards of performance and efficiency that the market demands. Securing data center capacity continues to be difficult for companies, prompting local governments to increasingly turn to renewable energy solutions to power the grid. Bloom Energy’s solid oxide fuel cell technology is at the forefront of off-grid power innovation. Our microgrids are at the cutting edge of these systems, which operate independently from the central grid. The Bloom Energy server implements #FuelCell technology to provide scalable, clean, and reliable off-grid power. Read more about the demand for power grids in this recent article from Utility Dive:  https://lnkd.in/gc55vjA5

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