NERC warns of summer grid strain amid load growth and heat risks

Load growth and expected higher temperatures could push peak demand higher this summer, potentially straining resources in some regions, according to the North American Electric Reliability Corporation (NERC) 2025 Summer Reliability Assessment.

Although the North American Bulk Power System (BPS) is expected to have sufficient resources under normal summer conditions, NERC cautioned that grid operators in many regions may face challenges during periods of high demand due to a resource mix that is generally less flexible and more variable.

Since last summer, NERC said the aggregate of peak electricity demand for its 23 assessment areas has risen by over 10GW—more than double the year-to-year increase that occurred between the summers of 2023 and 2024.

15 of the 23 regions expect higher peak summer demand in 2025, according to NERC’s assessment. Above-average temperatures and below-average precipitation are expected across much of North America. Temperature is one of the main drivers of demand and can contribute to forced outages for generation and other system equipment.

New data centres, electrification and industrial activity continue to drive load growth forecasts. NERC’s report projects notable demand increases in the US West (+5%), where a new peak demand record was set last summer; and SERC Southeast, driven by economic growth, industrial activity, and data mining.

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Retirements and reliability issues for aging assets

Adding to these challenges, more than 7.4GW of generation capacity— including 2.5GW of natural gas and 2.1GW of coal-fired units—has been retired or deactivated ahead of the upcoming summer.

Active but aging generation facilities also present increased challenges to maintaining generator readiness and resource adequacy, NERC said. Forced outage rates for conventional generators and wind resources have trended historically high in recent years, the organization reported. System operators face an increasing risk of resource shortfalls and operating challenges caused by forced generator outages, especially during periods of high demand or when fewer conventional resources are dispatched to serve load.

There are greater threats to BPS reliability in regions where aging resources are further depended upon to provide essential reliability services. In the Southwest, for example, a portion of capacity has been in operation for roughly 60 years. Electric utilities in this region have also described aging generation as a reliability challenge, NERC reported.

Historical performance has demonstrated the need for planning for elevated forced outage rates for these aging generators. Older generators can also require extensive overhauls, such as generator rewinds, that take resources out of service for extended periods of time as findings can lead to additional unplanned maintenance.

Inverter-based resource concerns

Growth in solar photovoltaic (PV) and battery storage resources has accelerated with the addition of 30 GW of nameplate solar PV resources and 13GW of new battery storage, according to the assessment. The new solar and battery resource additions are expected to provide over 35GW in summer on-peak capacity. New wind resources are expected to provide 5GW on peak.

In Texas, California and across the UqS West, the influx of battery energy storage in recent years has markedly improved the ability to manage energy risks during challenging summer periods, NERC said.

However, NERC has cautioned that grid operators must remain alert to the risk of inverter-based resources (IBRs) unexpectedly tripping offline during grid disturbances—a persistent near-term reliability concern. To address this, NERC continues to collaborate with industry on long-term solutions.

In April, the organisation released its Aggregated Report on NERC Level 2 Recommendation to Industry: Findings from Inverter-Based Resource Model Quality Deficiencies Alert, summarising issues identified in a June 2024 alert. Key findings include:

• Many operators lacked the necessary data, highlighting ongoing weaknesses in data acquisition and management.
• Interconnection process requirements were found to be inadequate.
• About two-thirds of grid protection settings were not configured to allow full ride-through capability, limiting the reliability contribution of BPS-connected solar PV facilities.
• 20% of surveyed sites were operating with a 0.95 power factor limit, leaving significant reactive power capacity underutilised.
• Dynamic model data was found to be inconsistent.

As solar, wind, and battery systems continue to dominate new capacity additions, NERC is stressing the need for improved system modeling, interconnection standards, and IBR performance practices across the industry.

NERC Recommendations

To reduce the risk of electricity shortfalls on the BPS this summer, NERC is recommending that grid operators do the following:

• Review seasonal operating plans and protocols for communicating and resolving potential supply shortfalls in anticipation of potentially extreme demand levels.
• Consider the potential for higher-than-anticipated forced generator outage rates in operating plans due to plant age, operating patterns or limited pre-seasonal maintenance availability.
• Employ conservative generation and transmission outage coordination procedures and operate conservatively commensurate with long-range weather forecasts to ensure adequate resource availability.
• Engage state or provincial regulators and policymakers to prepare for efficient implementation of demand-side management mechanisms called for in operating plans.

NERC further stressed that grid operators with solar PV resources should implement recommendations in the IBR performance issues alert that NERC issued in March 2023. The organisation said state regulators should have protocols in place at the start of summer for managing requests from generators for air-quality restriction waivers.

Originally published in Factor This Power Engineering.