U.S. electricity demand poised to hit new highs in 2025, 2026

U.S. electricity consumption is projected to rise in 2025 and 2026, surpassing the record set in 2024, according to the latest Short-Term Energy Outlook from the U.S. Energy Information Administration (EIA).

The increase marks a notable shift from nearly two decades of flat demand. Between the mid-2000s and early 2020s, electricity use held steady as efficiency gains and economic changes offset population and economic growth. During that period, structural shifts—such as the move from manufacturing to less energy-intensive service sectors—also contributed to stagnant demand.

The latest EIA outlook shows that demand has rebounded since a relative low in 2020. Total electricity use is expected to grow at an average rate of 1.7% annually through 2026. Consumption in the commercial sector, which includes energy-hungry data centers, is forecast to grow by 2.6% per year, while the industrial sector, including manufacturers, will grow at a 2.1% annual rate. Residential demand is expected to increase more modestly, averaging 0.7% growth annually—largely driven by weather patterns.

To meet the rising demand, electricity providers are expanding generating capacity, particularly in solar and battery storage. Much of the new capacity is being built in Texas, California, the upper Midwest, and the Northeast.

The surge in electricity use has also prompted broader efforts to reinforce grid reliability and efficiency. Utilities and grid operators are investing in high-voltage transmission lines, energy efficiency programs, and demand response strategies. These initiatives are backed by regulatory oversight and utility spending data analyzed by the Federal Energy Regulatory Commission.