Electricity, Coal, and Renewables

Electricity consumption
Electricity consumption reaches record levels in our forecast, driven by data center development and increased manufacturing activity in the commercial and industrial sectors. We expect electricity sales in the United States to total 4,135 billion kilowatthours (BkWh) in 2026, an increase of almost 2% over 2025. We expect an additional growth of nearly 2% in electricity sales in 2027, with total electricity consumption totaling 4,211 BkWh in 2027. We forecast that commercial sector electricity sales will increase by 3.3% in 2026 and 2.7% in 2027, accounting for 63% and 56% of the increase in electricity sales in those years. We forecast industrial sector electricity sales will rise 1.6% in 2026 and 2.6% in 2027, accounting for an additional 22% and 36% of increased electricity sales, respectively. Although Texas has paused the connection of new data centers to the grid to facilitate a regulatory audit of proposed data center projects, the West South Central region still accounts for the largest regional share of growth in total electricity sales, totaling nearly 20% of nationwide growth in 2026 and nearly 40% in 2027.

Electricity generation
Electricity generation grows in line with electricity use in the forecast. With natural gas generation in the United States rising by 2% in 2026 and 1% in 2027, coal generation falls by 8% in 2026 and 6% in 2027. As wind and utility-scale solar capacity continues to be added to the grid, we expect solar generation to grow by 21% in 2026 and by 18% in 2027, while wind generation grows 7% in 2026 and 5% in 2027.

We expect the PJM interconnection to account for nearly 45% of the growth in total U.S. generation in our forecast, with natural gas generation driving the increase in 2026 and natural gas, coal, and wind generation driving the increase in 2027. Meanwhile, the growth in solar generation is concentrated in the parts of the grid managed by the Electric Reliability Council of Texas (ERCOT) and the Midcontinent Independent System Operator (MISO). In 2026, we expect added solar generation of 18 BkWh in ERCOT and 13 BkWh in MISO, followed by an additional 20 BkWh in ERCOT and 11 BkWh in MISO in 2027.

Coal markets

Reduced demand for coal in the electric power sector leads to lower coal production in our forecast. We expect coal production to fall from 528 million short tons (MMst) in 2025 to 516 MMst in 2026 and 497 MMst in 2027. The decline is driven primarily by the Western region, which produces about half of total coal supply in the country. We expect production in the Western region to decline by about 4% in 2026 and another 5% in 2027, to a total of 260 MMst. Smaller changes are expected in the Appalachian region, where production in 2026 remains relatively flat before declining by about 2% in 2027. The Interior region also is expected to have similar production levels in 2026 as last year, before dropping by about 5% in 2027 to 79 MMst.

Although coal exports in our forecast increase compared with 2025, we forecast domestic demand for coal from the electric power sector will decline by 8% in 2026 and 6% in 2027, as natural gas and renewables generation in the Northwest and MISO regions increases.