US seasonal power outlooks Summer 2025: hot topics for ERCOT, MISO and PJM

As electricity demand rises and renewables stacks continue to grow, US Regional Transmission Organisations (RTOs) are racing to build out and improve infrastructure to ensure sufficient reliable electricity supply.  

Our latest series of webinars for the US power sector provided a recap of activity for key US RTOs in Spring 2025 and looked ahead to Summer 2025, as well as highlighting key longer-term themes for each.  

Fill out the form at the top of the page for complimentary access to the full slide decks from the events, or read on to learn about topics that are a key focus for ERCOT, MISO and PJM respectively. 

Gotta HV it! ERCOT plans major transmission upgrades 

Like most RTOs, the Electric Reliability Council of Texas (ERCOT) has seen a significant increase in demand for electricity within its remit – a trend that is expected to continue. For example, load in Far West Texas has doubled over the past five years, with significant increases in large-load demand from oil and gas production, crypto mining and other industries. 

By 2030, ERCOT projects peak summer demand to push 150 GW, with 50 GW of that expected to come from large-load interconnections. Constant load growth has already led to increased congestion and highlighted the need for improved infrastructure to cope, prompting a series of major transmission buildout plans. Projects include: 

• San Antonio South Reliability II Project: This is the second phase of a US$435 million scheme forming one of four projects for the South Texas Import and Export Generic Transmission Constraint (GTC) Exit Strategy. Phase II involves the upgrading of Spruce-Pawnee and Pawnee-Tango 345 kilovolt (kV) transmission lines from single circuits to double circuits. Originally planned to start in 2028-9, it is now expected to be accelerated – largely due to thermal retirement decisions near San Antonio. Completion of the first circuit of both sections is now planned for September 2026, with the entire project to be operational in early 2027. 
• Sam Switch – Venus Switch: Similar upgrading from single to double circuit 345 kV lines is planned for Sam Switch to Venus Switch, north of Waco in ERCOT’s North and North-Central area. This would increase the normal and emergency ratings from 1065 megavolt-amperes (MVA) to 1792 MVA or more. However, elevated GTC risks can be expected during construction. 
• Victoria-Rayburn: This smaller project in the Houston area will upgrade the 138 kV Victoria-Loop 463-Rayburn transmission line from 159 MVA to 403 MVA. 
• Howard-Solstice Transmission Line Project: On 24 April 2025, AEP Texas was approved to build the first extra high voltage (765 kV) line in ERCOT in a jointly assigned project, as part of the Permian Basin Reliability Plan. Approximately 300 miles of line will connect AEP Texas’ Solstice Substation near Fort Stockton to a substation near San Antonio. The plan could cost 22% more than a lower voltage alternative but will carry more power, reducing congestion costs and necessitating fewer future upgrades. 

Radiant future: solar generation set for a key role in MISO 

The rapid rise of the solar stack in the Midcontinent Independent System Operator (MISO) region has made solar an increasingly hot topic in recent years. Since 2023, capacity has almost quadrupled, leaping from around 4.2 GW to 16.2 GW and putting MISO in third place among US system operators for solar generation (behind ERCOT and CAISO). 

Several factors have driven this rapid development: 

• Government incentives including the Inflation Reduction Act (IRA) and state-level Renewable Portfolio Standards 

• Low-carbon goals set by MISO utilities 

• Corporate sustainability goals and power purchase agreements (PPAs) 

• Ageing thermal generation and coal retirements  

• Strong solar irradiance – especially in MISO’s Central and South areas 

Healthy capacity factors 

Solar capacity factors are naturally lower than for conventional assets due to the inability to generate electricity during the hours of darkness. However, at an average of around 21%, solar capacity factors for MISO states compare relatively well with those for Texas (24%) and California (25%). 

Impacts of increased solar adoption 

On sunny days, solar generation can provide a significant amount of cheap energy – on 16 April 2025 at 14:55 EST, solar comprised a record 18.4% of the fuel mix in MISO.  

Upsides to solar adoption include lower peak prices on sunny days, less susceptibility to natural gas price fluctuations, and meeting emissions reductions goals. On the downside, intermittency drives increased volatility and reliability issues, including unavailability during morning and evening peaks and the straining of resources from rapid ramp-up and ramp-down of thermal generation. Meanwhile, reduced revenues for conventional dispatchable units can make them uneconomic and take them out of the energy mix. 

Volatility is likely to be higher than for ERCOT and CAISO due to lower irradiance and a lack of co-located battery storage projects. Solar-driven congestion is also a risk across the footprint and will become more of an issue as the stack continues to grow. This can create local pricing disparities in addition to bearish/bullish risks to hubs. 

Expect ongoing growth 

Despite these issues, MISO’s solar fleet will continue to grow. We have identified 26 GW of new utility-scale projects, which would bring total capacity to about 40 GW by 2030s – with significantly more expected through 2050. Behind-the-meter (BTM) solar will also grow, which should help to suppress demand during peak hours. 

Watt a load: data centres drive surging demand in PJM  

Soaring demand for electricity from data centres and other large-load sources is a common theme across many US regions, and Pennsylvania-New Jersey-Maryland Interconnection (PJM) is no exception. In its 2025 forecast, PJM puts peak demand for the region at 229 GW in 2045. Additionally, it’s peak demand forecast for 2037 has increased by almost 30 GW, or nearly 20%, in the last two years alone.  

Long-term load growth is a challenge 

While the Federal Energy Regulatory Commission (FERC) has given PJM the all-clear in its 2025 Summer Reliability Assessment, rising demands from utilities to increase loads present an issue for future years. For example, American Electric Power (AEP) has requested 18 GW of load adjustment for 2035, with concerns centring around transmission rather than supply as loads increase.  

Reasons to be hopeful 

Fortunately, there are reasons to believe load growth may be somewhat lower than PJM predicts. It can take up to eight years before data centres take up maximum load (PJM forecasts just three-to-four years), and facilities tend to use only 70-90% of contracted capacity. Meanwhile, projects that increase load may get pushed back if the grid is not healthy enough. While it still represents a significant increase from around 150 GW today, Wood Mackenzie’s own estimate for peak load in PJM in 2045 is significantly lower than PJM’s own estimate, at 193 GW. 

Stack upgrades are on the way 

Nevertheless, upgrades to the generation stack for PJM are still badly needed. To address the problem, PJM has selected 51 projects through its reliability resource initiative (RRI), which will provide almost 10 GW of additional generation by 2031. Gas will dominate the additions, with the three largest gas projects together generating just over 4 GW. 

Learn more 

Don’t forget to fill out the form at the top of the page for complimentary access to the slide decks from our ERCOT, MISO and PJM webinars. As well as recaps of the spring period and price expectations for summer generation, these contain more detailed coverage of the above themes and other special topics. 

Plus, learn more about Wood Mackenzie’s Power Trading Analytics products.