Heating, transportation electrification seen driving ISO-NE power demand growth

ISO New England projects the region's annual power demand will increase by about 11% over the next decade, with net annual power use expected to grow by 1.2% annually over the 10-year period, mainly driven by the electrification of heating systems and transportation.

Total annual power consumption is projected to grow from 117,262 GWh in 2025 to 130,665 GWh in 2034, according to the 2025 Capacity, Energy, Loads, and Transmission Report released May 1.

Annual power consumption in the region peaked in 2005 at 136,425 GWh and then generally declined until 2024 when it reached 116,813 GWh. The grid operator is forecasting a period of growth over the next decade, but it still does not reach the 2005 peak.

"Net annual energy use in New England grew steadily between 1995 and 2005, driven primarily by increased economic growth and the use of air conditioning," ISO-NE said in a statement regarding the CELT Report.

Since 2005, net annual energy consumption has trended downward mainly due to an increase in energy efficiency from advanced cooling and heating technologies, energy-efficient appliances and lighting, and the increased deployment of behind-the-meter solar PV generation, the grid operator said.

However, ISO-NE predicts that trend will reverse in the next decade, with the ISO forecasting steady growth in net annual energy use "as state policy goals for carbon emissions reductions drive the increased electrification of heating systems and transportation in the region."

Heating, transportation electrification forecast

The electrification of heating systems is expected to play a major role in reaching New England state greenhouse gas emissions reduction mandates and long-term decarbonization goals, according to the grid operator's Final 2025 Heat Pump Forecast.

ISO-NE's heating electrification forecast reflects the expected energy and demand impacts of regional power customer adoption of heat pumps to electrify space and water heating in residential and commercial buildings, the ISO said.

The forecast grows from 692 GWh in 2025 to 8,049 GWh in 2034.

Transportation electrification is also expected to be an important part of achieving New England state GHG emissions reduction mandates and goals.

However, the ISO has enhanced its forecasting methods since last year's forecast, including an hourly methodology intended to more accurately account for evolving power production and demand patterns. Previously, the CELT was mainly based on annual power and seasonal peakload projections, the grid operator said.

Importantly, the updated methodology has resulted in a lower overall power use forecast than previous CELT Reports. "In particular, the transportation electrification forecast has been revised downward due to slower-than-expected EV adoption to date and uncertainty around incentive programs moving forward," the ISO said.

Forecasts for peak power demand remain roughly in line with previous expectations, ISO-NE added.

The EV forecast methodology has been adjusted to use customer adoption data instead of state policy goals.

"Recently compiled EV adoption data for the last few years has shown that our EV adoption forecast across all vehicle types remains too high, and is out of sync with recent adoption trends," the ISO said in its Final 2025 Electric Vehicle Forecast.

Regarding personal light-duty EV adoption, the ISO forecasts an annual incremental increase in EV stock from 86,863 vehicles in 2025 to 329,543 vehicles in 2034.

EVs are expected to account for 8,735 GWh of power consumption in 2034.

Additionally, transportation electrification is forecast to contribute 1,764 MW to the 50-50 winter peakload in 2034-35, meaning there is a 50% chance that peak demand will be above or below the forecast.

The ISO also said that behind-the-meter solar PV is forecast to have an increasing impact on 50-50 winter peak demand, reducing it by 402 MW in 2034/2035.

"As a result of heating electrification, winter peaks are expected to begin shifting from evening, when BTM PV is inactive, to morning, when production from solar installations is beginning to ramp up," ISO-NE said.