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Q4 2022
Electrifying the U.S.: Utilities Control the Path to Decarbonization
September 26, 2022
Electrification Critical in the Clean Energy Transition
The path to eliminating carbon emissions will run through utilities, leading to accelerating electricity demand growth and new energy infrastructure investment. After incorporating our latest clean energy outlook, we now forecast 1.4% annual U.S. electricity demand growth during the next decade, up from 1.2% in our previous forecast two years ago (Exhibit 1). Our new forecast is more bullish than most forecasts. We think others underestimate the speed and scale of the U.S. clean energy transition.
Widespread electrification of the economy will be required to achieve ambitious government and corporate environmental goals. This has big implications for investors. The electric grid is already strained. Accelerating electricity demand growth amplifies utilities' opportunities and challenges as they manage the surge of electric vehicles, big data, building electrification, and other mandates. We forecast 6%-8% annual earnings and dividend growth for most utilities through the decade as they invest in infrastructure to support the return of electricity demand growth
The path to eliminating carbon emissions will run through utilities, leading to accelerating electricity demand growth and new energy infrastructure investment. After incorporating our latest clean energy outlook, we now forecast 1.4% annual U.S. electricity demand growth during the next decade, up from 1.2% in our previous forecast two years ago (Exhibit 1). Our new forecast is more bullish than most forecasts. We think others underestimate the speed and scale of the U.S. clean energy transition.
Widespread electrification of the economy will be required to achieve ambitious government and corporate environmental goals. This has big implications for investors. The electric grid is already strained. Accelerating electricity demand growth amplifies utilities' opportunities and challenges as they manage the surge of electric vehicles, big data, building electrification, and other mandates. We forecast 6%-8% annual earnings and dividend growth for most utilities through the decade as they invest in infrastructure to support the return of electricity demand growth