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Faster-than-Expected Data Center Load Growth May Cause Increased Regional Short-term Fossil Fuel Generation and Wholesale Electricity Prices

LCG, March 18, 2026--The EIA released a new "In-depth Analysis" of the potential impact of faster-than-expected near-term growth in data center power demand on power generation and wholesale prices on March 12. The analysis models the lower 48 states through 2027 and compares results to its base case scenario. Key takeaway from this sensitivity analysis is the potential increase in fossil fuels in some regions and potentially a significant increase in wholesale prices in ERCOT.

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Faster-than-Expected Data Center Load Growth May Cause Increased Regional Short-term Fossil Fuel Generation and Wholesale Electricity Prices

LCG, March 18, 2026--The EIA released a new "In-depth Analysis" of the potential impact of faster-than-expected near-term growth in data center power demand on power generation and wholesale prices on March 12. The analysis models the lower 48 states through 2027 and compares results to its base case scenario. Key takeaway from this sensitivity analysis is the potential increase in fossil fuels in some regions and potentially a significant increase in wholesale prices in ERCOT.

Read more

Industry News

California Market Design Proposal Approved by ISO

LCG, June 27, 2003--The Board of Governors of the California Independent System Operator today announced its approval of a revised set of rules for the market overseen by the grid operator.

The revised version of the MD02 plan reflects input by stakeholders, who commented on the Revised Comprehensive Market Design Proposal in May, as well as on the first version of MD02. "The concepts in this comprehensive design represent significant steps the ISO can take to protect California consumers from Enron-styel games and other predatory tactics that contributed to the energy crisis of 2000 and 2001," said Michael Kahn, the chairman of the Board of Governors.

Notable changes as compared with the previous versions include a "cost aggregation" feature of Locational Marginal Pricing, handling of Existing Transmission Contracts, and payments for Residual Unit Commitment (to units for start-up and operating costs when they are not already available). Additionally, a requirement concerning Available Capacity has been dropped. An alternative method of encouraging future supply expansion will be investigated.
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The Locational Marginal Price Model (LMP) Network Power Model
Uniform Storage Model
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UPLAN-ACE
Day Ahead and Real Time Market Simulation
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