Electric Power Generation & Distribution NAICS 2211

        Electric Power Generation & Distribution

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Industry Summary

The 2,441 Electric power generation and distribution companies in the US produce and deliver electricity to residential customers, commercial businesses, and industrial operations. The industry consists of publicly-owned utilities, electric co-operatives, investor-owned utilities, and power marketers. Operations are either fully or partially regulated, depending on the state they operate in.

Changes in Environmental Laws and Regulations

Environmental laws and regulations are changing constantly and can have large impacts on electric utilities.

Shift to Natural Gas Generation

Low natural gas prices and restrictions on coal and nuclear plants are causing a shift to natural gas for new generating capacity.


Recent Developments

May 21, 2025 - Many Proposed Data Centers Unlikely to be Built
  • Utilities and grid operators are grappling with a flood of speculative interconnection requests for data centers that may never be built, according to Utility Dive. Grid optimization software firm Camus Energy estimates there are between five and 10 times as many interconnection requests as the number of data centers being built. US data center load growth forecasts often diverge widely. A 2024 projection by the RAND Corporation estimated the AI sector would boost power demand by 347 gigawatts (GW) by 2030. In April 2025, Schneider Electric cited other sources that estimate growth will be less than 100 GW. Speculative requests by data center developers make it challenging for grid operators and utilities to plan for future power needs. To reduce the risks of overbuilding, some utilities are introducing standardized large-load interconnection processes, and others are requiring data center developers to shoulder more of the upfront costs.
  • North American construction and engineering spending in the power sector in 2025 is expected to grow by 6% and notch robust annual growth through 2029, according to FMI’s second-quarter 2025 North American Engineering and Construction Outlook. While the Trump administration is emphasizing natural gas and oil production, the ongoing electrification of transportation and manufacturing, as well as voracious demand from data centers, will increase demand from all electricity sources except coal. Technology firms are investing in clean energy microgrids, nuclear energy, and battery storage systems to power their data centers. According to the 2024 US American Society of Civil Engineers’ infrastructure Report Card, 20% - or about $2 trillion – of the US’s total infrastructure needs through 2023 are related to energy. FMI forecasts that energy construction and engineering spending will rise 5% in 2026, 3% in 2027, 4% in 2028, and 6% in 2029.
  • More clean energy-related projects are being paused, downsized, or cancelled due to policy shifts under the Trump administration, according to Manufacturing Dive. In the first quarter of 2025, companies announced $8 billion in project downsizing and cancellations, according to E2, a clean-energy nonprofit that tracks and releases monthly updates on green energy project announcements. In all, 16 projects were cancelled in the first quarter, including solar, wind, and electric vehicle plants. After the passage of the Inflation Reduction Act (IRA) in 2022, the law’s tax credits for clean-energy manufacturing projects and direct funding and loan financing attracted billions in climate-related investments. However, on his first day in office, President Trump froze funding under the IRA pending government review. Trump has been critical of EV tax credits under the IRA, as well as a Biden-era executive order calling for EVs to make up half of US auto sales by 2030. The clean energy sector is also bracing for the impact of tariffs, which would drive up project costs for key inputs, including EV battery and solar cell components.
  • US electricity generation capacity additions in 2025 are expected to be led by solar and battery storage projects, according to the US Energy Information Administration (EIA). The US is projected to add 63 gigawatts (GW) of generating capacity in 2025, led by utility-scale solar with 32.5 GW, followed by battery storage (18.2 GW), wind (7.7 GW), and natural gas (4.4 GW). Additions in Texas (11.6 GW) and California (2.9 GW) will account for nearly half of the solar capacity additions in 2025. Other states that are expected to have significant upticks in solar additions in 2025 include Arizona, Florida, Indiana, Michigan, and New York.

Industry Revenue

Electric Power Generation & Distribution


Industry Structure

Industry size & Structure

A typical electric power company operates from multiple locations and has revenues of about $230 million per year.

    • There are 2,441 firms providing electric power utility services in the US, employing 413,100 workers, and generating annual revenue of $562 billion.
    • 58.8% are publicly owned utilities, 25.5% are cooperatives, 5.2% are investor-owned utilities, 9% are power marketers, and 1.6% are either community choice aggregators, behind-the-meter (on-site generation), or federal power agencies.
    • Public utilities serve 14.8% of US customers, cooperatives serve 12.9%, investor-owned utilities serve 66%, power marketers serve 4.6%, and behind-the-meter (on-site generation) serves 1.6%.
    • 67% of establishments have fewer than 20 employees, and 7% of firms are large with 100 or more employees.
    • Large electric power utilities include: Exelon Corp., Southern Co., First Energy, Puerto Rico Electric Power Authority (PREPA), PSEG Long Island, Los Angeles Department of Water and Power (LADWP), Withlacoochee River Electric Cooperative, Cobb Electric Member Corporation and Middle Tennessee EMC.
    • Entry into the business as a for-profit enterprise in the distribution business is difficult as most population centers are in franchised territories as designated by the state public utility commission. Entry into the generating business as an independent power producer (IPP) has a lower barrier, requiring only permits and capital for construction and certification by the ISO.

                                Industry Forecast

                                Industry Forecast
                                Electric Power Generation & Distribution Industry Growth
                                Source: Vertical IQ and Inforum

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