The EIA expects 63 GW of new utility-scale electricity generating capacity to be added to the US power grid in 2025. This represents an almost 30% increase from 2024, when 48.6 GW of capacity was installed, the largest capacity installation in a single year since 2002. Together, solar and battery storage account for 81% of the expected total capacity additions, with solar making up over 50% of the increase.

The record-breaking trend for solar energy continues, as generators added 30 GW of utility-scale solar capacity to the US grid in 2024. This represented 61% of the year’s capacity additions. A year on, EIA is predicting an addition of 32.5 GW of new utility-scale solar capacity in 2025. Texas and California are anticipated to be the frontrunners, contributing 11.6 GW and 2.9 GW respectively. Additionally, Indiana, Arizona, Michigan, Florida and New York are each expected to add over 1 GW of solar capacity, collectively accounting for 7.8 GW of planned solar additions.

Battery storage capacity is also poised for growth in 2025. The EIA forecasts 18.2 GW of new utility-scale battery storage, building on the record 10.3 GW added in 2024. ‘This growth underscores the critical role of battery storage in balancing supply and demand and enhancing grid stability when paired with renewable energy sources,’ says the EIA.

The wind energy sector is set to contribute an additional 7.7 GW of capacity to the US grid in 2025. This is a notable increase from the 5.1 GW added in 2024, the smallest wind capacity addition since 2014, says the EIA. Texas, Wyoming and Massachusetts are expected to account for nearly half of these new wind capacity additions. Significant projects coming online include the 800 MW Vineyard Wind 1 project in Massachusetts and the 715 MW Revolution Wind development in Rhode Island.

Natural gas-fired capacity is also on the rise, according to the EIA, with developers planning to build 4.4 GW of new capacity in 2025. Utah, Louisiana, Nebraska, North Dakota and Tennessee will account for more than 70% of these additions. The largest projects include the 840 MW Intermountain Power Project (IPP) in Utah and the 678.7 MW Magnolia Power project in Louisiana. The natural gas capacity additions at IPP will replace 1,800 MW of coal-fired capacity scheduled for retirement in July, notes the EIA.

On the cusp of an American energy expansion  

Meanwhile, a new report published by BloombergNEF (BNEF) and the Business Council for Sustainable Energy (BCSE), says the focus of US energy system planning has shifted towards growth. It cites factors including rapidly rising expectations of power demand from new industrial sources and transportation, onshoring of US manufacturing and a burst of new data centres planned by tech companies in the race to develop artificial intelligence (AI) mastery.

‘We are on the cusp of an American energy expansion,’ says BCSE President Lisa Jacobson. ‘The US will need more energy to run homes and businesses and to continue to be a global economic powerhouse. Renewable energy and natural gas are the growth sectors of the energy industry, and, when paired with energy efficiency technologies, will be fundamental in meeting demand growth.’

The anticipated rise in energy demand is foreshadowed by a rise in announcements of corporate power purchase agreement (PPA) volumes. These set a new record of 28 GW in 2024, up 26% from 2022, according to the report. A total of 183 deals for clean power were signed in 2024, nearly double the amount of PPAs in the prior year. Tech companies spearheaded this growth, accounting for 84% of overall deal activity, in anticipation of growing AI and data centre demand.

The BNEF-BCSE report also notes that the US invested $338bn in sustainable energy in 2024, up from $303bn in 2023, with a focus on renewable energy, electric vehicles and power grid enhancements. However, the report highlights that emerging industries like hydrogen and carbon capture and storage saw slow deployment progress while facing uncertainty in federal guidance and permitting, respectively. Onshore wind power saw its fourth consecutive year of declining capacity additions, while offshore wind spent 2024 recovering from cancellations of contracts for projects due to inflation. ‘Further growth in these industries will depend on clear and coherent support from federal and state policymakers,’ it says.

A key obstacle remaining for future energy deployment is the slow pace at which infrastructure projects secure all necessary permits and move forward, warns the study. In 2024 alone, 317 GW of new capacity applied for grid connections in the seven US independent system operators, representing nearly a third of the current installed US power system.  

A new report from Rystad Energy also highlights how data centres are ‘reshaping the US power sector’. It finds that more than 100 GW of data centre land acquisition and construction announcements with estimated commercial operation dates falling between 2024 and 2035 have been made in the US. ‘At a global level, this represents roughly 40% of total data centre announcements as of 2023,’ says Rystad. It estimates that US data centres will require between 395–660 TWh of power by 2035, driven by rapid advancements in AI technologies alongside continued growth in cloud computing services.