Heat wave strains US power markets ahead of July 4 travel rush
Temperatures forecast as high as 105°F are lifting power demand, raising wholesale electricity prices and threatening rail, air and road delays.
By Marcus V. Thorne · Markets Editor
· 3 min read
A severe heat wave across the central and eastern United States is set to run into the Independence Day weekend, raising electricity demand and creating risks for one of the year’s busiest travel periods. The National Weather Service said temperatures could reach 105 degrees Fahrenheit, or 40.5 degrees Celsius, with some daily, monthly and all-time records possible.
The agency said the conditions increase the risk of heat-related illness, especially for vulnerable people and those without reliable access to cooling. High humidity is expected to make the heat feel more intense, according to the National Weather Service.
The operational strain is already visible in power markets. PJM, the largest U.S. grid operator, said Friday afternoon that it was under a federal alert to reduce electricity use across a service area that includes tens of millions of people in the Mid-Atlantic, parts of the South and Washington, D.C.
Power demand and prices rise
Extreme heat tends to lift electricity consumption as households and businesses use more air conditioning. When demand rises sharply, grid operators may call for conservation and wholesale prices can move higher as more expensive power supply is brought into the market.
Wholesale spot electricity prices climbed more than 243% in New England and 101% in New York City on Thursday, according to U.S. Energy Information Administration data. The EIA data also showed increases of nearly 55% in the Midwest and 45.6% in the Mid-Atlantic.
New York City Mayor Zohran Mamdani urged residents Thursday to reduce pressure on the state grid. In a post on X, he asked residents to set air conditioners to 78 degrees Fahrenheit, switch off electronics that are not being used and run appliances such as dishwashers and washing machines early in the morning or late at night.
Mamdani also advised New Yorkers to remain indoors to avoid the worst heat. Philadelphia, where temperatures exceeded 100 degrees Fahrenheit, canceled a Friday parade marking America’s 250th birthday.
Scientists have warned that climate change is increasing the frequency and intensity of extreme weather events. The United Nations says the burning of coal, oil and gas is the main driver of the climate crisis.
Travel operators warn of disruption
The heat is also affecting travel systems during the July 4 holiday week. Amtrak said earlier in the week that trains could run at reduced speeds and face delays between 11 a.m. and 7 p.m. through July 4 because of forecast extreme temperatures in the Northeast, Southeast and Midwest.
New Jersey Transit said trains serving New York were expected to face delays and cancellations tied to heat-related effects on equipment.
Air travel is also exposed to schedule changes. Delta Air Lines issued a service notice saying it would waive change fees for trips through New York’s LaGuardia Airport this week because of the hot weather.
Road agencies have warned drivers about infrastructure stress. The Illinois Department of Transportation told motorists to watch for pavement failures, saying road surfaces can buckle during extreme heat.
The combined pressure on electricity systems and transport networks highlights how a prolonged heat event can affect household energy use, wholesale power markets and holiday mobility at the same time. Public agencies and transport operators have framed the response around conservation, schedule flexibility and safety precautions while the heat persists.
This story draws on original reporting from CNBC.
