Declining Grid Reliability Threatens Food Security and Economic Development

Corn refining facilities, like every household and business in America, rely on predictable and affordable power. Over the past several decades, power availability and prices have been relatively stable, allowing food manufacturers like CRA member facilities to serve as keystones in their surrounding rural economies and to provide products that diversify farm income and bolster food security. However, skyrocketing demand and inadequate infrastructure threaten the ability of America’s food manufacturers to deliver these key benefits.

Any unplanned loss of power can result in complete halts in production, leading to loss of material, clogged equipment, downtime, and potential supply chain interruptions. In food manufacturing, the intricate nature of shutting down facilities means that even brief power disruptions can lead to extended recovery periods, sometimes surpassing 24 hours. Increased operational costs are ultimately passed onto consumers, worsening food price inflation and threatening food security.

Food manufacturing facilities are often located near the farms that they source from, providing lucrative jobs in rural areas and more markets for farmers. There are real risks that some parts of the country, especially rural areas may miss out on economic development opportunities because their local electric grid can’t keep up. Such instability undermines the international competitiveness of American food manufacturers and jeopardizes the reliability of the supply chain, ultimately impeding economic growth and prosperity.

The Grid’s Infrastructure is Unprepared for Surges in Demand

Power demand is rising at its fastest pace in decades, as the Federal Electricity Regulatory Commission (FERC) forecasts 128 GW of additional demand by 2029, which would be the equivalent of adding the electric demand equivalent to three times the annual demand of the state of California to the grid. This stark increase is largely due to a surge of AI data centers, extreme weather events, and increasing use of electrification in the nation’s vehicle fleet. Simultaneously, American utility companies expect to continue decommissioning coal-fired power plants and other fossil fuel facilities in the next 10 years, with 113 GW of fossil fuel or nuclear power plants expected to retire. Even if enough power could be produced, there is doubt that the grid transmission system can adequately deliver it to power customers. Almost three-quarters of it is more than 25 years old and needs to be replaced.  

Building a Dependable Electricity Grid

To keep the grid reliable, we need to balance how much power we use with how much we can produce. Policymakers should avoid adding new demands to the grid without first making sure we have enough power and transmission infrastructure to support them. At the same time, investing in stronger infrastructure now will help ensure the grid can meet future energy needs. To this end, CRA is working with the emPOWER Rural America coalition – a group of agribusiness leaders and other rural stakeholders seeking to amplify rural electricity needs – to advocate for grid modernization that does not leave rural America behind.