The pressure to meet demand from data centers is increasing rapidly, especially in those states where markets are expanding.

A June 2025 report by the Texas Reliability Entity (Texas RE) forecasts historical demand increases in the region that is serviced by the Electric Reliability Council of Texas (ERCOT), the independent systems operator that manages almost the entire power market (about 90%) for the state.

According to the report, Texas will experience “unprecedented load growth” over the next several years. The increase is primarily driven by the significant demand incurred by new data centers and other artificial intelligence (A.I.) services. Increased demand from the oil and gas sectors will also contribute to the need for more power.

Texas RE notes that ERCOT has forecast an additional 70.5 gigawatts (GW) of new load interconnecting to the system by 2028. All that demand may not materialize, but even with some downward adjustments, it is still a significant number. To put the figure into perspective, the Texas RE report observes that the region reported a summer peak demand of 85.2 GW on August 20 last year.

The report says the new demand poses “a significant challenge,” and the current “disorganized integration of large loads” has created the largest increased risk to the region.

This risk, the report asserts, “will require a comprehensive and proactive response” to maintain the reliability of distribution in the state.

At the same time, the region’s power industry is changing dramatically, as variable sources from solar and wind continue to expand. According to the report, over the past five years, the total energy from solar generation in the region has increased 996%, while energy from coal resources has declined 25%. Wind and solar served 34.8% of total energy in the Region in 2024 and experienced a peak hourly penetration of nearly 75% in March 2025.

The trend is expected to continue. ERCOT projects solar generation capacity to nearly double over the next two years. Similarly, storage capacity neared 10 GW in 2024 and is forecasted to almost triple to 27.5 GW during the next two years.