Well over half of North America is staring down the barrel of a potential electricity supply shortage, according to the North American Electric Reliability Corporation’s (NERC) latest 2024 Long-Term Reliability Assessment (LTRA). The report is a wake-up call, highlighting the perfect storm brewing from surging demand growth, accelerating generator retirements, and persistent delays in resource development. This isn’t just a ticking time bomb; it’s a full-blown crisis in the making.
The grid is already feeling the heat, grappling with shrinking reliability margins and operational stress as the energy transition races ahead. NERC’s findings paint a sobering picture of a power system unprepared for the demands of the future. John Moura, NERC’s director of Reliability Assessments and Planning Analysis, drives the point home: “Simply put, our infrastructure is not being built fast enough to keep up with the rising demand.” The urgency for collaboration among policymakers, industry leaders, and stakeholders is paramount. They must come together to expand the bulk power system and ensure new resources can connect reliably.
The 2024 LTRA reveals that over half of North America is at an elevated risk of energy shortages, significantly worse than last year. Regions like the Midcontinent Independent System Operator (MISO) have been flagged as “high risk,” with resource adequacy targets potentially unmet in the next five years. Other areas, including PJM, ERCOT, and California-Mexico, are also marked as elevated-risk zones. Canada isn’t spared either; regions like Ontario and British Columbia are at risk, especially under extreme weather conditions.
The report highlights a troubling trend: generator retirements are outpacing resource additions. By 2029, confirmed retirements are expected to reach 52 GW, with a staggering 115 GW potentially decommissioned over the next decade. That’s about 10% of the total installed capacity in the U.S. at the end of 2023. The implications are clear: if we don’t manage these retirements carefully, we risk a reserve margin shortfall across nearly every area in North America.
While resource capacity has grown slightly, it’s still lagging behind the pace of demand. The interconnection queue has expanded by 12% in the past year, but actual resource integration is falling short, particularly for solar PV. In fact, connections for solar PV were 14 GW lower than projected last year. On the flip side, battery storage has exceeded expectations, but it’s not enough to fill the gaps left by retiring fossil fuels.
As we shift towards more renewable energy sources, the grid’s reliability is becoming increasingly variable and weather-dependent. The growing reliance on solar PV and wind means that our energy mix is subject to the whims of Mother Nature. This variability poses significant reliability challenges that are unlikely to dissipate anytime soon.
The stakes are high. If we don’t address these vulnerabilities head-on, we could find ourselves in a precarious situation where demand outstrips supply, leading to blackouts and economic turmoil. The message is clear: we need to act swiftly and decisively. The energy transition is not just a buzzword; it’s a necessity. The future of North America’s electricity supply hangs in the balance, and the time for collaboration and action is now.
