Reliability in a Rapidly Changing Economy — June 15, 2026
Hello, and welcome to the Economic and Market Watch podcast for the week of June 15, 2026. This is Sam Kem of CFC.
Sam Kem:Today's episode is quite special because I have not one but two industry experts with me to discuss a major issue reshaping the electric industry: Reliability in a rapidly changing economy.
Sam Kem:For years, electricity demand in the U.S. was relatively flat. But now we're entering a very different environment. AI, data centers, manufacturing, reshoring, electrification, and population growth are all driving electricity demand higher. And in many places, much faster than infrastructure can be built.
Sam Kem:Peak demand is expected to grow roughly 3.7% annually through 2030, and that's creating major economic and operational challenges for utilities across the country. This raises important questions about reliability.
Sam Kem:To help answer some of these questions, joining me today are Alicia Pinto and Chris Whittle, authors of CFC's latest reliability issue brief, "Considerations for a changing Grid: How are Cooperatives Ensuring Electric Reliability?"
Sam Kem:Thanks for joining me, Alisha and Chris.
Alisha Pinto:Happy to be here.
Chris Whittl:Thanks for having us.
Sam Kem:One of the biggest themes in the issue brief is that reliability risk is becoming much more regional. We're no longer talking about one national reliability story.
Sam Kem:Alisha, from the generation side, what does that look like?
Alisha Pinto:What's really interesting right now is how uneven reliability risk has become across the country. Some regions are struggling with rapid data center growth. Others are more exposed to extreme weather or fuel constraints. In the Pacific Northwest, for example, utilities are reevaluating how dependable hydropower will be under changing weather and policy conditions. In MISO, winter reliability and fuel security are becoming major concerns.
Alisha Pinto:So reliability planning is becoming much more localized and region-specific than it was a decade ago.
Sam Kem:And economically, that's important because it changes investment priorities. Utilities are no longer making decisions based solely on national trends or average forecast. They are reacting to very localized risk that can vary dramatically from one region to another.
Sam Kem:So Chris, transmission seems to play a major role in this regionalization too. Is that correct?
Chris Whittl:That's absolutely right. Transmission topology matters a lot more now. Some regions may technically have enough generation overall, but they can't move the power efficiently to where demand is growing the fastest.
Chris Whittl:Georgia is a great example of this. You've got explosive growth from data centers, manufacturing, and population expansion across state. That requires enormous transmission investment, not just generation investment, in order to maintain reliability.
Sam Kem:One thing that really stood out to me in the issue brief is that the biggest problem may not actually be a lack of proposed projects. It's the industry's ability to execute.
Sam Kem:We have generation projects, we have transmission plans, and we have available capital. But projects are getting delayed everywhere. So, Chris, what's driving that?
Chris Whittl:A lot of factors. Permitting delays, equipment shortages and rising costs, labor constraints, citing opposition, it all adds up.
Chris Whittl:Transmission projects especially can take years just to get approvals because they cross multiple jurisdictions and involve complicated landowner and local government negotiations.
Chris Whittl:And the timelines are long. AI infrastructure is scaling fast, but transmission infrastructure is lagging and can easily take a decade or more to complete.
Sam Kem:Economically, that creates a fascinating challenge because AI investment is moving incredibly fast, while utility infrastructure moves much more slowly. So, Chris, that puts transmission directly in the spotlight. Am I right?
Chris Whittl:Absolutely. Transmission used to be kind of the quiet side of the industry. Now it's really becoming one of the central infrastructure challenges in the country. The U.S. may increasingly have enough generation overall, but not enough transmission capacity to move the electricity efficiently to where it's most needed.
Chris Whittl:And the economics of transmission are actually very strong. Studies estimate that every dollar invested in major high voltage transmission can generate anywhere between $3.80 and $4.70 in total economic benefits.
Sam Kem:That timing mismatch may end up being one of the defining economic constraints of the next decade. One statistic from the issue brief that really captured the issue is only 13% of generation projects requesting interconnection between 2000 and 2019 were actually operating by 2024.
Sam Kem:Alisha, from the generation side, how is this changing utility planning?
Alisha Pinto:Utilities are increasingly prioritizing projects that are actually buildable and financeable, not just theoretically economical.
Alisha Pinto:So, historically, utilities optimized for least-cost planning. A lot of the projects in the interconnection queue do not come to fruition, but ultimately create backlogs and delays.
Alisha Pinto:Today, utilities are optimizing for execution certainty. That means securing equipment early, diversifying supply chains, locking in turbine orders, managing fuel risk, and building more options into resource portfolios.
Sam Kem:So, let's talk about AI and data centers because they are becoming one of the biggest economic drivers behind all of this. These facilities aren't just large loads. They are very reliability sensitive loads. So, Alisha, what makes them very different?
Alisha Pinto:Data centers fundamentally change how utilities think about demand growth. It's not just about total electricity consumption anymore. Utilities also care about when demand occurs, how concentrated it is, and how reliable service needs to be. Hyperscale data centers often require redundant transmission, dedicated substations, and guaranteed capacity. They're extremely sensitive to outages.
Sam Kem:Another important takeaway from the issue brief is that despite rapid renewable growth, every case study still emphasized the importance of dispatchable generation. Alisha, how are utilities thinking about natural gas today?
Alisha Pinto:Utilities increasingly view natural gas as traditional baseload generation as well as reliability insurance, especially during extreme weather, periods of low renewable output, or peak demand events.
Alisha Pinto:And importantly, the co-ops we interviewed consistently emphasized diversified portfolios. This isn't really a simple renewable versus fossil fuels discussion. It's about maintaining reliability under stressed system conditions.
Sam Kem:And that's a really important nuance economically because outages are incredibly expensive. Reliability has real economic value.
Sam Kem:In fact, reliability is not just an engineering issue. It's deeply tied to economics, supply chains, permitting, governance, politics, and long term infrastructure strategy.
Alisha Pinto:Exactly, Sam. Utilities are shifting from optimizing purely for efficiency towards optimizing for resilience and execution certainty.
Chris Whittl:And ultimately, the future of economic growth, especially in regards to AI growth and industrial expansion, may increasingly depend on whether the power grid can keep up with the speed of modern demand growth.
Sam Kem:And that's a wrap for today. I strongly encourage our listeners to download this issue brief to explore more details and especially the case studies. Please find the link to the issue brief in the show notes. Alisha and Chris, thanks again for joining me today.
Alisha Pinto:Thanks for having us.
Chris Whittl:Thanks, Sam.
Sam Kem:That's it for today. But before I let you go, this podcast is available on many podcast apps, including Apple Podcasts and Spotify. If you don't subscribe already, please subscribe, rate us, and leave a review. And as always, if you have any questions, please reach out to the economic research team at economicresearch@nrucfc.coop.
Alisha Pinto:Enter the industry team at utilityresearchpolicy@nrucfc.coop.
Sam Kem:Thank you for listening. Talk to you soon.
