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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

Iceland Chooses Hydrogen

LCG, June 3, 2002-Iceland has decided to phase out fossil fuels, choosing to power the country by means of hydrogen fuel cells.

Iceland, which is home to a mere 278,000, already powers 93 percent of homes with geothermal-derived electricity. Now the country will switch its vehicles to hydrogen, with the help of DaimlerChryler, Royal Dutch Shell, and Norsk Hydro. The three companies will invest in the newly-created Icelandic New Energy.

Hydrogen fuel, which produces water as its only exhaust, will be produced relatively emission-free by way of hydroelectric and geothermal sources.

DaimlerChrysler is responsible for the design of new Icelandic buses, which will be in service next year.

Iceland is more ambitious than merely converting the buses, however, and plans eliminate the need for fossil fuel from its 180,000 vehicles over a period of 30 or 40 years.

Icelandic electricity production is already clean, but the country suffers from high carbon dioxide emissions because of its metal smelting industry.

Although hydrogen, when used as a fuel, is a pollution-free energy source, the volatile element needs to be obtained by some method usually requiring a lot of energy since hydrogen does not easily exist alone and unreacted in nature. Electrolysis separates water with the help of electricity yielding oxygen and hydrogen, which is the reverse reaction of hydrogen when it acts as a fuel producing electricity and water. Other sources of hydrogen, such as hydrogen-producing algae, are currently being researched.

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