US electricity demand set to surge 25% by 2030 as AI drives unprecedented growth
America faces a dramatic surge in electricity consumption over the next five years, with demand expected to rise by 25% by 2030 and a staggering 78% by 2050, according to a new report from consulting firm ICF.
The findings, reveal an energy landscape evolving at breakneck speed, far outpacing historical trends from the past two decades. Peak electricity demand is projected to grow 14% by 2030 and 54% through to 2050.
The surge is being driven by a perfect storm of technological and consumer shifts. Artificial intelligence applications, which require massive computational power for training and operation, are spurring unprecedented demand for data centres. These facilities, along with expanding cloud-based services and energy-intensive cryptocurrency mining operations, are consuming electricity at rates that surpass traditional computing needs.
Simultaneously, the electrification of transport and heating is accelerating across both residential and commercial sectors. Electric vehicle adoption is rapidly expanding as manufacturers phase out petrol models and governments implement emissions targets. The shift extends beyond cars to include electric buses, delivery vans, and industrial vehicles.
In homes and businesses, the transition from gas heating to electric heat pumps is gaining momentum, driven by both climate policies and efficiency improvements. Other electricity-hungry technologies becoming mainstream include electric water heaters, induction cooking systems, and increasingly powerful home electronics and appliances.
However, this unprecedented growth comes at a cost. Residential electricity rates could rise between 15% and 40% by 2030, depending on local market conditions, the report warns.
"This is a pivotal moment as rising demand creates urgent challenges for the grid," said Anne Choate, ICF's Executive Vice President for energy, environment and infrastructure. She emphasised that meeting this demand will require a coordinated "all-of-the-above" strategy across the energy sector. This approach recognises that no single energy source will be sufficient to bridge the gap.
The report emphasises the critical role of demand-side management programmes, which could meet 10% or more of electricity demand by 2030, up from just 8% in 2025. These initiatives include demand response systems, energy conservation measures, and behind-the-meter capacity solutions that can provide fast, affordable alternatives to building new power plants.
Choate stressed that success will require "nuanced pricing, temporal considerations, and customer engagement" to manage when and how electricity is consumed. The timing of electricity use will become increasingly important as utilities struggle to meet peak demand periods.
The findings represent a dramatic shift from recent projections, with demand growth far exceeding even ICF's own forecasts from last year. This rapid acceleration reflects how quickly the digital economy is reshaping America's energy needs, with implications extending far beyond the tech sector.
