Markets

Electric Industry

OVERVIEW
The world has a population of over 6 billion with net electricity consumption of 14,275 billion kilowatt hours (kWh) in 2002 according to the Energy Information Administration (EIA). The EIA estimates that global electricity consumption will increase to 26,018 billion kWh by 2025.

The United States generated 3,971 billion kWh of electricity in 2004. The EIA estimates that U.S. electricity generation will increase nearly 50% by 2030 to approximately 5,918 billion kWh.

With the advent of the digital revolution in the 1990s, electricity has accounted for more than 80% of the total growth in U.S. energy demand. To keep pace with electricity demand and plant retirements, the EIA estimates that 428 gigawatts (GW) of new U.S. generating capacity will be needed by 2025. Plant retirements from the U.S.’s aging generation fleet, averaging 40 years of service, are projected to be 82 GW by 2025.

Growing demand for power and the deregulation and restructuring of the power industry has created financial and political challenges and opportunities in the electric power supply industry. This evolving competitive industry environment is driving traditional energy providers to develop new strategies and seek new technologies for electricity generation, transmission and distribution.

The use of renewable energy technologies for electricity generation in the U.S. is projected to grow, stimulated by improved technology, higher fossil fuel prices, and extended tax credits provided by federal and state renewable energy programs. The EIA projects that total renewable/other generation will grow by 1.7 percent per year, from 358 billion kWh in 2004 to 559 billion kWh in 2030.

Electricity Generation by Fuel Type
Source: Energy Information Administration