A report recently released by the North American Electric Reliability Corporation (NERC) says a 15-state area of the electric grid in the Midwest under grid operator MISO, including most of Illinois, is at “high risk” of power shortages over the next decade during both normal and extreme weather conditions. As a whole, NERC finds the North American bulk power system is facing similar electric resource risks.
The MISO region is noted for not having enough electricity to meet demand within five years, according to NERC’s newest annual Long-Term Reliability Assessment (LTRA). NERC’s reliability assessments are developed to inform industry, policymakers, and regulators as well as to aid NERC in achieving its mission to ensure the reliability of the North American bulk power system.
According to the report, high risk areas are likely to experience a shortfall in electricity supplies at the peak of an average summer or winter season. It also projects shortfalls could occur during spring and fall, months that are not typical peak demand seasons for MISO. Extreme weather, producing wide-area heat waves or deep-freeze events, poses an even greater threat to reliability in its analysis.
The Midcontinent Independent System Operator (MISO), the organization responsible for reliable power transmission across most of Illinois,
also encompasses all or part of 14 other states and Manitoba—and is shown as “high risk” in the NERC 2024 report.
Illinois’ situation in MISO is somewhat unique as compared to other Midwest states with its legislation, the Climate and Equitable Jobs Act (CEJA) requiring all non-municipal coal plants and some older natural gas plants to retire by 2030, and municipally-owned coal plants CWLP Dallman 4 and Prairie State Generating Station along with all remaining natural gas plants, to be zero carbon or have all units retired by 2045. CEJA also calls for all electricity in the state to come from zero carbon sources, including renewable energy, nuclear power or any others commercially viable.
As the need for energy supply grows and traditional plants close, however, NERC is asking policymakers and regulators to manage the pace of generator deactivations and ensure replacement infrastructure can be developed, along with seeing that siting and permitting processes are streamlined to speed transmission planning and projects.
For CWLP to work to address and plan for these challenges locally, the utility’s upcoming FY26 Budget, plans for funding to start a new Integrated Resource Plan (IRP) Process. IRPs are utilized as planning tools for utilities to select the best energy sources given the market conditions, rules and regulations, and new technologies that are available. With respect to its own generation, given pending environmental regulations including the USEPA Greenhouse Gas rule, which may or may not impact Dallman 4 and its other gas peaking generators, the IRP will seek to identify a plan with regard to reliability, affordability, and sustainability of CWLP's electric resources. CWLP and other MISO region partners are also working to plan to ensure reliable generation capacity and be prepared in the event of energy shortfalls. Along with planning for generation resources, the utility is also focusing on energy efficiency initiatives and demand-response programs with pursuit of advanced electric smart metering infrastructure, AMI meters, that will allow for better management of peak load periods.
Report Highlights
NERC uses both an assessment and a reserve margin analysis to assess the risk of future electricity supply shortfalls. Both are forward-looking snapshots predicting resource adequacy or reliability based on industry forecasts of electricity supplies, demand, and transmission development.
In the MISO region specifically, the report says additional coal-fired generator retirements and slower-than-anticipated resource additions since its 2023 report have caused a sharp decline in anticipated resources beginning summer 2025. In addition, it projects MISO’s peak demand forecast rising in 2026 and later, further lowering reserve margins compared to the 2023 report. Reserve margins in MISO for both summer and winter are projected to fall below what NERC notes is the Reference Reserve Margin Level (RML) reserve margin requirements as new generation is insufficient to make up for generator retirements and load growth.
MISO is at high risk of experiencing electricity supply shortfalls beginning in Summer 2025 based on
Projected Reserve Margins derived from anticipated resources and demand forecasts.
MISO’s capacity resources continue to turn over with coal units retiring in the region, and being primarily replaced by intermittent resources such as solar, wind, and battery facilities. Around 6 GW of coal plant capacity has retired in the last year and another 12 GW is projected to retire in the next five years in MISO. As older fossil-fired generators retire and are replaced by more solar and wind resources, the resource mix is becoming increasingly variable and weather-dependent. Generation installation delays result in uncertainty throughout the assessment timeframe.
Throughout the NERC region the report notes the addition of variable resources or intermittent resources, primarily wind and solar, and the retirement of conventional generation are fundamentally changing how the bulk power system is planned and operated. With electricity supplies coming increasingly from intermittent energy resources and natural-gas-fired generators, there is a growing risk that supplies can fall short of demand during some periods. Geographically diverse wind and solar resources and loads can help reduce these risks, but they require robust transmission networks, comprehensive energy and transfer capability analysis, and effective operating procedures and market mechanisms.
Natural-gas-fired generators are a vital bulk power system resource. They provide essential reliability services by ramping up and down to balance a more variable resource mix and are a dispatchable electricity supply for winter and times when wind and solar resources are less capable of serving demand. Natural gas pipeline capacity additions over the past seven years are trending downward in the U.S., and some areas could experience insufficient pipeline capacity for electric generation during peak periods.
To the extent that variable or intermittent energy resources are uncertain during times of peak stress on the grid,
there is a risk of gas delivery capacity being insufficient for the amount of natural gas supply that could be required to meet the demand increase.
Growth in large load parcels like data centers and industrial facilities pose various challenges to reliability as well. Other types of large industrial loads include smelters, manufacturing centers, hydrogen electrolyzers, and future electrified mass transit or shipping charging stations are also cited to add more load and uncertainty.
One estimate of data center growth in the United States by 2027.
To address the energy and capacity risks identified in affected regions identified in the report, NERC recommends the following priority actions:
• Integrated Resource Planners, Market Operators and Regulators should carefully manage pace of generator deactivations and ensure replacement
infrastructure can be developed and placed in service
• NERC and Regional Entities should incorporate new analysis and criteria in the LTRA to inform stakeholders of future reliability risks
• Regulators and Policymakers should streamline siting and permitting processes to speed transmission planning and projects
• Regulators, Electric Industry & Gas Industry should implement framework addressing operating and planning needs of interconnected natural gas
electric energy system
• Grid Operators & FERC should continue to ensure essential reliability services are maintained.
