In this article, we list and discuss the 15 Industries with the Highest Electricity Consumption in the US. If you would like to skip our detailed discussion of the topic, you can go directly to the top 6 Industries with the Highest Electricity Consumption in the US.
First discovered in the year 1752 by Benjamin Franklin, electricity has now become an essential component of the modern-day world. It also plays a huge role in boosting economic development; so much so that the United States, the largest economy in the world today, ranks second on the list of countries that produce the most electric power.
According to the Energy Information Administration (EIA), in 2023, the US generated approximately 4.18 million Gigawatt-hours (GWh) of electricity at utility-scale electricity generation facilities. For context, utility-scale electricity generation facilities are power plants that have a total electricity generating capacity of at least one megawatt or 1,000 kilowatts (0.001 gigawatts). About 60% or 2.5 million GWh of this electricity was generated from burning fossil fuels like coal, natural gas, petroleum, and other gasses. As for the rest, 21.4% of electricity was generated through renewable energy resources, and 18.6% was generated from nuclear energy.
In addition to this, small-scale solar photovoltaic systems accounted for another 73,620 GWh of electricity generation. So, in total — combined with utility-scale electricity generation — the United States generated about 4.252 million GWh (or about 485.34 Gigawatts) of total electricity in 2023, which was an increase of about 50,000 GWh from 2022.
Given these large generation statistics, it comes as no surprise that the US is also the second-largest electricity consumer in the world. According to EIA, in 2022, the US electricity consumption in GWh stood at 4.07 million, which was 3.2% higher than in 2021. This consumption varied in distribution across three major sectors: residential, commercial, and industrial. Out of these, the sector that uses the most electricity in the US is the residential sector, consuming 38.4% or 1.51 million GWh of electricity. On the other hand, industrial sector energy consumption was only 26% or around 1.02 million GWh — the least amount of electricity consumed out of the three major sectors.
Speaking of the industrial sector, it’s interesting to note that in 2023, the IEA reported electricity consumption in the US fell by 1.6% due to factors like milder weather and a slowdown in the manufacturing sector. However, IEA forecasts the demand to grow again by 2.5% in 2024, followed by an average growth of 1% over the next couple of years by 2026.
While electricity is a clean and relatively safe source of energy, unfortunately as we mentioned above, a huge portion of electricity in the US is generated using fossil fuels, which are already depleting and harming the environment. To combat this, some key players in the energy generation industry, like NextEra Energy, Inc. (NYSE:NEE), Exelon Corp (NASDAQ:EXC), and FirstEnergy Corp (NYSE:FE), have set goals to reduce their fossil fuel consumption and achieve carbon neutrality.
One of the leading renewable energy companies in the world, NextEra Energy, Inc. (NYSE:NEE), set goals to eliminate all scope 1 and scope 2 carbon emissions across all its operations by 2045. To achieve such a goal without compromising on the success of the company, NextEra Energy, Inc. (NYSE:NEE) has been investing in and developing clean energy technologies and generating electricity through only renewable carbon-emissions-free resources such as wind, solar, battery storage, nuclear, and green hydrogen.
Meanwhile, Exelon Corp (NASDAQ:EXC) is on the path to achieve carbon neutrality by 2050 and reduce at least 50% of GHG emissions by 2030. In 2022, Exelon Corp (NASDAQ:EXC) helped customers save almost 24,800 GWh and avoid more than 9.5 million tons of greenhouse gas (GHG) emissions. Moreover, its Green Power Connection programs successfully connected nearly 3.1 gigawatts of renewable energy generation for over 200,000 utility customers.
On the other hand, FirstEnergy Corp (NYSE:FE) pledged to achieve carbon neutrality by reducing GHG emissions by 2050. However, in 2023, the company faced some challenges, particularly in its two coal plants in West Virginia – Fort Martin and Harrison, which are the main sources of the company’s scope 1 emissions. While FirstEnergy Corp (NYSE:FE) wants to reduce its GHG emission from Fort Martin and Harrison coal plants, it can’t reduce its coal generation as the West Virginia state is heavily reliant on coal generation and has energy policies to ensure sustainability in coal generation in the state.
Consequently, in 2023, FirstEnergy Corp (NYSE:FE) removed its interim goal of achieving a 30% reduction in GHG emissions by 2030. However, being one of the giants in the energy industry, FirstEnergy Corp (NYSE:FE), is still on track to achieve carbon neutrality by 2050.
15 Industries with the Highest Electricity Consumption in the US
Our Methodology
For our list of 15 Industries with the Highest Electricity Consumption in the US, we obtained consumption and efficiency data from EIA as derived from the Manufacturing Energy Consumption Survey of February 2021. We looked at the annual electricity consumption in the US by industry and shortlisted the top 15 industries that consume the most electricity. Sub-sectors of major industries were not considered in the ranking, but have been mentioned in the list. Below, we list the top fifteen major industries with the highest electricity consumption in America; ranked in ascending order of the net demand for electricity (million kilowatt-hours).
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15 Industries with the Highest Electricity Consumption in the US
15. Textile Industry
Net Demand For Electricity (Million Kilowatt-hours): 10,949
The textile mill industry, being one of the biggest manufacturing industries in the US, consumes the fifteenth-highest amount of electricity in the country. According to the NCTO, the U.S. textile industry supply chain employed 501,755 workers in 2023. Also, America is the second largest exporter of textile-related products in the world, and the combined export value of fiber, textile, and apparel stood at $29.7 billion in 2021. In comparison to textile mills, the net demand for electricity in the textile product mills industry stands at about 2,858 million kilowatt-hours.
14. Electrical Equipment, Appliances, and Components
Net Demand For Electricity (Million Kilowatt-hours): 11,083
The electrical equipment, appliance, and component manufacturing industry is responsible for products that generate, distribute, and use electrical power. These include electric lamp bulbs, lighting fixtures, parts of electric lighting equipment, household appliances and their parts, electric motors, generators, transformers, switchgear apparatus, and devices for storing electrical power (e.g., batteries), for transmitting electricity (e.g., insulated wire), and wiring devices (e.g., electrical outlets, fuse boxes, and light switches). According to the US Bureau of Labor Statistics, as of March 2024, there are about 411.7 thousand employees in this industry. Between 2018 and 2023, the industry’s revenue has grown at a CAGR of 3.3%.
13. Beverage and Tobacco Products
Net Demand For Electricity (Million Kilowatt-hours): 14,442
Ranked 13 on the list, the Beverage and Tobacco Product Manufacturing industry consumes a total of 14,442 million kilowatt-hours of electricity annually, with the beverages-only sub-sector consuming about 1,672 million kilowatt-hours, and the tobacco-only sub-sector consuming about 28 million kilowatt-hours of electricity. According to the US Bureau of Labor Statistics, the beverage industry is further divided into three sub-sectors: alcoholic, non-alcoholic, and distilled alcoholic beverages. Similarly, the tobacco industry is divided into two sub-sectors: those engaged in redrying and stemming tobacco, and those that manufacture tobacco products like cigarettes and cigars.
12. Computer and Electronic Products
Net Demand For Electricity (Million Kilowatt-hours): 22,245
With the increasing popularity of remote work and online businesses, the demand for computers and electronic products is increasing every passing day. According to EIA, the subsector in the industry that consumes the most electricity is the semiconductors and related devices industry, with an 11,614 million kilowatt-hours net demand for electricity.
11. Wood Products
Net Demand For Electricity (Million Kilowatt-hours): 22,526
The wood products manufacturing industry in the US includes the manufacturing of all wood products, the production processes, assembling, and establishments that make all these things. Generally, the subsectors in the industry are specified based on manufactured products, except for sawmills and wood preservation establishments. While the overall industry consumes 22,526 million kilowatt-hours of electricity annually, the major subsectors consume comparatively less electricity.
The veneer, plywood, and engineered woods subsector consumes 6,999 million KWh, the reconstituted wood products subsector consumes 4,423 million KWh, and the other wood products subsector consumes 6,422 million KWh. According to the 2021 Economic Survey by the US Census Bureau, there are 13,887 employer establishments in the industry.
10. Machinery
Net Demand For Electricity (Million Kilowatt-hours): 23,810
Ranked 10th among the top 10 industries with the highest electricity consumption in the US, the machinery manufacturing industry consumes around 23,810 million KWh of electricity. The US Labor Statistics Bureau reported that there were 1,133.9 thousand employees in the industry as of March 2024, with team assemblers having the largest share of the workforce.
9. Fabricated Metal Products
Net Demand For Electricity (Million Kilowatt-hours): 36,281
The fabricated metal products manufacturing industry transforms metal into intermediate or end products, except for the huge machinery and related products. The industry had a revenue of $343 billion in 2017, and it consumes around 36,281 million KWh of electricity.
8. Nonmetallic Mineral Products
Net Demand For Electricity (Million Kilowatt-hours): 38,145
The scope of the nonmetallic mineral products industry transforms mined or quarried nonmetallic minerals, such as sand, clay, and refractory materials, into products for intermediate or final consumption. Among others, the subsectors of this industry include the clay building material and refractories industry, the flat glass industry, the glass containers industry, and the mineral wool industry. Of all subsectors in the nonmetallic mineral products industry, the cements industry consumes the highest amount of electricity, with a net demand for electricity of 11,444 million KWh.
7. Plastics and Rubber Products
Net Demand For Electricity (Million Kilowatt-hours): 49,342
Seventh on the list, the plastics and rubber products manufacturing industry is one of the major ones in the US. Although plastic and rubber are vastly different materials, they are considered one industry because plastics are now used more often as substitutes for rubber. According to Census data, there are around 11,518 employer establishments in this industry, and according to the US Bureau of Labor Statistics, there were around 726.8 thousand employees in the industry as of March 2024.
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Disclosure: None. 15 Industries with the Highest Electricity Consumption in the US is originally published on Insider Monkey.