US Power & Utilities: The Grid Sets the Limit: Forecasts Meet Reality – Updated 2026 S&D Model

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US Power & Utilities: The Grid Sets the Limit: Forecasts Meet Reality – Updated 2026 S&D Model

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US Power & Utilities

The Grid Sets the Limit: Forecasts Meet

Reality – Updated 2026 S&D Model

Industry Overview

Market constrained by power delivery not demand 04 June 2026

We refresh our June 2025 framework with a consistent conclusion: U.S. power markets Equity

are now supply-constrained, not demand-driven. While demand is accelerating (~2%+ United States

CAGR), deliverability—not forecast load—is the binding constraint, increasingly capping Utilities

realized growth across regions. The market is no longer constrained by demand—it is Ross Fowler, CFA

constrained by where power can actually be delivered. Research Analyst

BofAS

Texas the clearest beneficiary of growth +1ross.fowler@bofa.com646 855 1506

Texas remains the clearest beneficiary, with strong realized demand supporting ongoing Rinny Singh

capex (CNP, SRE, AEP). However, even here, realized growth is tracking below headline ResearchBofAS Analyst

forecasts, reinforcing that interconnection and buildout timelines are limiting outcomes. +1 646 855 5729

rinny.singh@bofa.com

By contrast, PJM highlights the downside of constraint, where a persistent gap between

F. Paul Cole

demand and deliverable supply is driving regulatory scrutiny and limiting load realization. Research Analyst

Supply and demand tightness support for the IPPs paul.cole2@bofa.com

Nicolas Woods

This backdrop is structurally supportive for IPPs (CEG, TLN, VST), where supply scarcity Research Analyst

drives higher power prices, stronger utilization, and increased asset value. At the same BofAS

nicolas.woods_barron@bofa.com

time, capacity constraints are driving load migration toward more flexible regions,

David Rold, CFA