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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

SWEPCO Announces Plans for New Coal-fired Power Plant in Arkansas

LCG, August 10, 2006--Southwestern Electric Power Company announced yesterday that it has selected a site in Hempstead County, Arkansas, for a new, 600-MW, coal-fired electric generating station. The location is approximately 15 miles northeast of Texarkana.

Southwestern Electric Power Company (SWEPCO), an affiliate of American Electric Power (AEP), stated that the planned new station will employ an ultra-super critical design and burn sub-bituminous, Powder River Basin coal from Wyoming. The estimated cost for the new plant is $1.3 billion, and the project is scheduled to commence operations by the summer of 2011.

AEP has plans to build two new coal-fired plants elsewhere in the east that use an Integrated Gasification Combined Cycle (IGCC) design, and these plants would consume coal with different qualities than that planned for the SWEPCO facility. According to SWEPCO, the difference in coal qualities requires IGCC technology other than the GE technology planned for the other two sites, and adequate performance guarantees were not available to support deployment of IGCC technology at the SWEPCO plant.

The announcement falls on the heels of similar announcements regarding new coal-fired generation capacity in the region. Earlier this month, Plum Point Energy Associates, LLC, a member of the LS Power Group, announced that it has signed a power purchase agreement with South Mississippi Electric Power Association to deliver electricity from the Plum Point Project, a greenfield, coal-fired power project with a design capacity of 665 MW. Construction on the Plum Point Project, located near Osceola, Arkansas, began in March of this year, and commercial operations are scheduled to commence in mid-2010. Plum Point is a member of the LS Power Group of St. Louis, Missouri.

Last month AEP, together with a group of electric utilities, announced plans to build a new, 950-MW, coal-fired power plant in north-central Oklahoma. The estimated cost of the new facility is $1.8 billion, and this project - like the SWEPCO project - would burn coal from the Powder River Basin. The project will be a joint venture of AEP's Public Service Company of Oklahoma, Oklahoma Gas & Electric Company (OG&E) and the Oklahoma Municipal Power Authority (OMPA).

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