Electroencephalogram (EEG) power reductions in the aging brain have been described by numerous previous studies. However, the underlying mechanism for the observed brain signal power reduction remains unclear. One possible cause for reduced EEG signals in elderly subjects might be the increased distance from the primary neural electrical currents on the cortex to the scalp electrodes as the result of cortical atrophies. While brain shrinkage itself reflects age-related neurological changes, the effects of changes in the distribution of electrical conductivity are often not distinguished from altered neural activity when interpreting EEG power reductions. To address this ambiguity, we employed EEG forward models to investigate whether brain shrinkage is a major factor for the signal attenuation in the aging brain. We simulated brain shrinkage in spherical and realistic brain models and found that changes in the conductor geometry cannot fully account for the EEG power reductions even when the brain was shrunk to unrealistic sizes. Our results quantify the extent of power reductions from brain shrinkage and pave the way for more accurate inferences about deficient neural activity and circuit integrity based on EEG power reductions in the aging population.