EIA: US spending on electricity infrastructure rises sharply

From 2003 to 2023, annual spending by US energy companies on electricity infrastructure rose by 12% to USD 320 billion. Most of the increase came from capital investment. The US government agency EIA reported the figures.

Electric utilities in the US have seen a significant increase in spending over the past 20 years, according to the US government agency Energy Information Administration (EIA). This is primarily due to investment in modernisation, renewable energy integration and grid resilience. Rising costs for energy infrastructure are generally a global trend.

Generation

According to the EIA, the cost of electricity generation fell by 24% over two decades, primarily as a result of lower fuel costs and the retirement of older fossil fuel power plants. In recent years, however, capital spending in this area has risen again, increasing by USD 4.7 billion in 2023, for example.

This is due to some high-cost projects, such as Georgia Power’s Vogtle nuclear power plant, whose final unit entered commercial operation in 2024.

Transmission and distribution

Spending on transmission systems that carry electricity over long distances nearly tripled from 2003 to 2023, reaching USD 27.7 billion. Spending on distribution infrastructure, which often accounts for the largest share of costs, rose by 160% over the 20 years to USD 50.9 billion.

Electric utilities had to increase investment in infrastructure to ensure resilience to extreme weather. Another key driver of higher costs is adapting equipment to accommodate renewable energy sources.

Spending on overhead infrastructure has increased by 11% since 2022, while investment in underground lines, intended to limit weather-related outages, more than doubled over two decades to USD 11.8 billion.

Modernisation and renewable integration

Utilities have strengthened grid resilience by modernising substations, transformers and other components, increasing costs by 15% compared with 2022. Spending on modernisation measures such as smart meters, energy storage and rooftop solar installations rose by 25% to USD 5.8 billion.