The CAISO recently released their 2025 Summer Load and Resources Assessment (“Assessment”). It details the balance of supply and demand in the upcoming summer to the end of analyzing how prepared the grid is for peak summer loads. Across North America and the world, there are two main factors at the top of mind when considering how grids have shifted. One is load growth, driven by increases in data centers and electrification, from heating to transportation. The other is capacity growth, which, in California, has been dominated by solar and batteries. The CAISO is cautiously optimistic, as capacity has increased much more than load in recent years. Still, caution is the key word here. Between strong expectations for load growth in coming years and the ever-present risk of an extreme heat event blowing up electricity demand, plenty of risk remains, this summer and beyond.

Figure 1 | Monthly Peak Load Forecast and Actuals

The table above shows the maximum load by month across the 2020s, from May to October. Up through 2024, we use historical data provided by CAISO, for 2025 onwards we use forecasts provided by the California Energy Commission (CEC), as marked by asterixis. The CAISO used the forecast pictured above to ground their Assessment, and 46,094 MW value seen for September 2025 stand as their expected maximum load in this upcoming summer. At first blush, this does not sound particularly impressive; it’s lower than what we saw in September 2024 and much lower than the record setting loads in September 2022.

Here, it’s important to acknowledge that the CEC forecast aims to produce a 1-in-2 load prediction, essentially a middle of the road estimate. So, the values for any given year are less important than the trend. This forecast predicts strong growth, starting this year and accelerating over the remainder of the decade. As the median expected loads increase, so too will the extreme highs. In combination with Mother Nature, this could easily produce another record in the coming years. In fact, the forecast predicts that even average conditions would become nearly record breaking by September 2029.

Figure 2 | Multi-hour Stack Analysis for September Peak Day[1]

The second figure, taken from the CAISO’s Assessment, gives a comparison of supply and demand for the predicted tightest day of Summer 2025. The bars depict the hourly generation capacity by resource and lines represent forecasted load and planning reserve margin (PRM), the amount of excess capacity needed in case of a loss of load event, i.e. a generator or transmission outage. The solid black line shows the 1-in-2 maximum peak load (46,094 MWs) from the CEC’s forecast. The dashed and dotted black lines represent two PRM targets. The dotted line shows the capacity needed to satisfy a 22.67% PRM, enough to avoid rolling blackouts in a 1-10 loss of load event. The dashed line depicts the capacity needed satisfy a 16.7% PRM. This is what would be needed assuming load-serving entities deliver on their own resource adequacy requirements. This analysis is the “cautiously optimistic news” mentioned in the opening paragraph. Even the higher of the two PRM requirements is lower than the CAISO’s total capacity, meaning they have more capacity than is necessary. If we take the 46,094 MW peak load number for granted, then the CAISO is prepared for the hottest days of summer and an unexpected loss of load, without needing to resort to demand reduction and curtailment of exported volumes.

Figure 3 | September 6^th, 2022, CAISO Generation Stack & Load

Demand reduction and curtailment of exported volumes was exactly what was needed back on September 6^th, 2022, when the CAISO experienced record loads. The chart above shows exactly how grid conditions played out on that day, with bars representing generation and the line depicting load. Hour ending 19 was the point at which the grid grew closest to rolling blackouts, as solar generation dropped much faster than load. By comparing figures 2 and 3 we can see how the CAISO’s stack has since developed. Most notable is the increase in batteries and solar.  Per the EIA filings, the CAISO has hosted 5,905 MWs of new battery capacity and 4,565 MWs of Solar between September 2022 and today. And the CAISO expects another 1,654 MWs of batteries and 354 MWs of solar to hit the grid prior to June 30^th [2]. This is good news for the tricky evening ramp hours, which now have more dispatchable resources available for when solar starts to fade. However, reflecting on September 2022 reminds us why we need caution to temper our optimism. While the grid looks comfortable at 46,094 MW, we know that extreme conditions can push it much higher, and the CEC’s forecast indicates that structural load growth has occurred since 2022, which means similar conditions would drive demand higher this time around.

The takeaway is to keep an eye on Mother Nature knowing that coastal heat trumps any growth in the supply stack, especially when we start to consider the impact of structural load growth. The CAISO is happy to report an improved supply/demand balance relative to years prior, but the tone will quickly shift if summer heat settles over coastal population centers, as it did on September 6^th, 2022. The CEC load forecast behind the CAISO’s assessment also offers important insights, as it predicts aggressive load growth in the coming years. If this forecast comes to fruition, the CAISO will need serious capacity additions to keep pace and maintain reliability on the hottest days.

[1] 2025 Summer Loads & Resources Assessment (PDF)

[2] 2025 Summer Load & Resources Assessment Technical Appendix (PDF)