Building the Next Generation of Energy Reliability

For the past 15 years, most new energy development focused on replacing existing generation — primarily coal-fired facilities — with renewables and more efficient gas-fired plants. Net-new demand was minimal and renewable energy filled the gap without creating a pressing need for additional dispatchable capacity. The grid evolved under the assumption that overall energy use would remain stable or grow only modestly.

That assumption no longer holds. Over the last two to three years, demand requests from new industrial and critical infrastructure have exploded. Where utilities once saw load requests in the range of 25 to 50 megawatts, today’s projects often seek 300 megawatts or more. Some large data center campuses are forecasting the need for 1 or 2 gigawatts within just a few years. This shift is largely fueled by the exponential growth in artificial intelligence (AI), cloud storage and domestic semiconductor manufacturing — sectors that are now central to both economic growth and national competitiveness.

The Reliability Challenge

This load growth is coinciding with a broader electrification trend. Hospitals, emergency systems, homes and communications infrastructure are increasingly dependent on uninterrupted electric power. As a result, the importance of system reliability has intensified and utilities must have access to firm, dispatchable generation that can respond quickly to demand spikes.

Building this kind of generation, however, has become more difficult and expensive. Projects that once took a few years now take twice as long, with costs continuing to rise. Supply chain constraints and a lack of investment in new manufacturing capacity have made equipment more difficult to obtain. Developers are also facing fuel supply constraints, particularly in regions without sufficient natural gas infrastructure. In many areas, pipeline capacity is fully subscribed and expanding it requires long permitting processes and costly capital projects.

These limitations are creating significant headwinds at a time when flexibility and speed are critical. While renewable energy development continues at a strong pace, wind and solar cannot provide the firm, on-demand capacity required to support sudden spikes in demand or to maintain system stability in the event of outages. Dispatchable generation remains an essential part of the energy mix, particularly as more industries, homes and critical services rely on the grid.

The Reshoring of U.S. Industry

The renewed interest in U.S.-based manufacturing is not solely driven by energy needs. Global supply chain disruptions, rising labor and production costs overseas, and shifting geopolitical dynamics have made domestic production more attractive. Although the U.S. has a more complex regulatory environment, it offers greater transparency, legal consistency and access to domestic energy resources. These advantages, paired with rising overseas costs, are shifting the calculus for companies weighing long-term infrastructure investment decisions.

With capital-intensive projects taking years to develop, decisions made today will define energy systems for decades. Developers and utilities must make thoughtful, forward-looking choices about where to invest and what technologies to adopt. New technologies that may not be viable under current market conditions could become practical within a few years as regulations and economics shift. Identifying strategic sites and engaging the right partner early in the process can have a major impact on long-term outcomes.

The energy sector is at a pivotal moment. Meeting rising demand with reliable, cost-effective power will require a coordinated approach across utilities, policymakers and industry. As the U.S. grid evolves to support a digital and industrial transformation, the ability to deliver firm, resilient energy will be central to economic success.