Co-ops Trying Various Approaches to Address Growing Power Demand

Demand for electric power is going up and some rural electric cooperatives worry that the trends could create burdens for residential customers in the form of rising costs or even periods of outage. The current estimate is that demand is growing 3 percent annually nationwide. Speakers at NRECA’s PowerXchange/TechAdvantage conference say they are trying multiple approaches to solve the problem. But the true pace of demand growth and the effectiveness of the solutions remain open questions.

Multiple conference speakers referred to a demand growth graph the New York Times published in March 2024. It shows (see illustration above) the rate of growth for the last 35 years, with a 15-year period (2007-2022) where the industry got used to remarkably level consumption. But demand began growing significantly after 2022. Conference speakers said that was when internet data centers, industrial buildings filled with servers, began having an effect.

New advanced artificial intelligence (AI) technologies require vast computing power, increasing data centers’ needs for electric power and water to cool their servers. Government agencies in recent months have taken increasing notice of the how data centers are changing the nation.

“You’ll have a data center approach a co-op, and maybe they’re not just looking in that area, but they’re looking all over. They’re coming to the table asking, ‘How quickly can you get me online? How quickly can you serve me?” said Jeffrey Groenewold, distributed energy resources specialist for Rayburn Electric Cooperative, a generation/transmission co-op in Texas, during a TechAdvantage session. Currently, most data centers are in a limited number of locations around the nation, but many expect that to change as data center owners look for less expensive real estate to build.

Data centers are not the only cause of demand growth. Cole Price, senior VP, Member Services for G&T Central Electric Power Cooperative in South Carolina, has noticed a trend toward electrification of automotive manufacturing facilities in his area. “We’re seeing more in industry who traditionally would have utilized natural gas to process switching to electric to be more sustainable. And that can have a very big impact,” he said during a PowerXchange breakout.

Another potential problem is rising in states that have passed mandates to phase out fossil fuels and rely more on wind and solar power. “We need a balanced approach,” Price said. “Don’t focus on one side or the other but make good choices to make sure that we have reliable power that’s affordable, and that all the options are on the table.”

“I would say from the energy mix perspective, we are all about an all-of-the-above approach,” said Courtney Dentlinger, VP, Customer Service for Nebraska Public Power District, a G&T that uses seven different generation technologies for its members, including nuclear.

“We are doing a lot more work on advanced nuclear,” Dentlinger said. “We have an 800-megawatt nuclear power plant, and we are actively looking at opportunities to add small modular reactors on our system and anxiously await those technologies to make it to the [Nuclear Regulatory Commission] process and become more commercially viable.”

While some explore meeting the demand with a mix of power-generation approaches, others are exploring energy efficiency. Some co-oops deploy Distributed Energy Resources Management Systems (DERMS), a way to interact with the members through thermostat and water heater programs. Co-ops communicate regularly with members to track residential demand. DERMS also is useful for controlling distributed energy resources, such as back-up battery systems.

However, customers have yet to accept energy management programs. Jeremy Konkle, chief operating officer of Tipmont Rural Electric Membership Corp. in Indiana, described efforts to implement DERMS and demand management. “Two thirds of them said, ‘I don’t trust you.’ They did say, ‘I don’t trust you.’ And they said, ‘I want control,’” Konkle said.

He suggested that co-ops must educate members to the point that they are ready, as old in the old Staples adverts, to push the Easy button.

Konkle also called for the DERMS to develop industry standards to allow for equipment from a growing list of vendors to interoperate. “It’s kind of the wild, wild west right now,” he said.