The Future of Electric Utilities: Responding to Real-World Demands with Practical Innovation
The electric utility industry makes bold claims about being transformative. One recent call for action dramatically declared a “new paradigm of thinking” with this statement:
Electric companies are revolutionizing the future of energy for their customers and communities. Enhancing resilience, driving sustainability, and enabling advanced energy solutions are at the heart of the profound transformation that the industry is leading, and innovative technologies are critical for them to achieve their full potential.
Is this our charge? What happened to delivering safe, reliable, resilient and affordable clean power to our customers? Isn't that challenging enough?
Do customers really want us to be revolutionary? Certainly, regulators and cooperative members would have an opinion.
Are electric utilities truly at the heart of a profound energy transformation that is “critical” for customers and communities to achieve their “fullest potential” or does our industry more realistically “respond” to customer and stakeholder demands? Who initiates the “new paradigm of thinking?”
Energy is the foundation of our capitalistic economy. Business and industry need energy and the basic critical infrastructure (water, sewer, communication, transportation, etc) to function at the most elementary levels.
While businesses and industries expect their energy companies to provide better resilience, cleaner or carbon free power, higher power factor or lower prices some industry megatrends have emerged. Megatrends are driven by technological and demographic changes. They are immutable. Identifying and understanding the megatrends in the booming electric transmission and distribution industry offer insight into strategies and subsequent opportunities in the future.
In 2012, I proposed five megatrends in a popular white paper entitled “Identifying Megatrends Shaping the T&D Industry.” I accurately predicted that grid modernization, energy storage, maximizing the use of transmission rights-of-way, the application of distributed energy resources, and operational efficiency would be hallmarks of the next generation electric utility…and, today, they are.
Was this “revolutionary” or “profound” or just good business?
Certainly, some electric (and gas) utilities across North America are more innovative and progressive than others. Most investor-owned utilities (IOU’s) understand their fundamental business model and regulatory compact. Public power and member-owned cooperatives have different access to capital and a different accountability model. However, all these companies understand that their customers need safe, reliable, resilient and affordable clean power to be competitive in a world marketplace and, yes, help their customers achieve their “full potential.”
The impacts and opportunities of emerging technologies on changing business models are impressive. The wants and demands of customers, regulators and other stakeholders continue to increase and change. Those utilities that understand megatrends and anticipate the opportunities, impacts and demands will remain relevant, succeed and grow.
There are some good examples of North American electric (and gas) utilities that meet their customer demands with good value, operational excellence, and increasing access to sustainable sources of clean energy. They embrace entrepreneurial creativity, employ intellectual genius and adopt the very best from other industries. These leading electric utilities apply a “new paradigm of thinking” that sets a “high bar” for their contemporaries to strive for and achieve.
Some examples of excellence include:
Minnesota Power - Going private and serving massive industrial loads with clean, low-cost reliable power. According to Daniel Gunderson, vice president, “Minnesota Power delivers most of its energy to large, energy-intensive industrial customers. In alignment with Minnesota’s energy policies, the company has achieved a remarkable transition from carbon-intensive energy since 2005, when more than 95% of our energy was produced by coal-fired generation. Today, more than 50% of our energy comes from renewable sources, which is coupled with our industry-leading load-control program to reliably serve all our customers.
Southern California Edison - Re-imagining the grid and using the digital twin of its T&D system to plan, design and operate it. “SCE is currently leveraging digital twins to identify and predict vegetation encroachment on their overhead lines, and they are currently undertaking projects to deploy digital twins to enable holistic planning that combines insights extracted with ML/AI from big data with physics-based simulation,” said Abder Elandaloussi, T&D innovation manager.
Other utilities in this group include:
PG&E - Rebuilding the company “from the underground up” with major innovations in underground design and construction.
Oncor Electric Delivery - Oncor has had massive load growth in the Dallas-Ft. Worth metro for over two decades. Now, data centers, crypto miners, EV fleets and new industrial plants are demanding higher levels of clean power with a 24-hour per day load factor.
NextEra - Embarking on $1B per year, 20-year plan to underground overhead laterals improving safety, reliability, resiliency and affordability (by driving down O&M costs).
Dominion Energy - Installed four Static Synchronous Compensators (STATCOMs) at existing substations in Chesapeake and Virginia Beach to help offset the loss of coal fired generation.
So are we leading a revolution, or simply adapting wisely to unstoppable change? Maybe it’s less about grand declarations and more about listening, anticipating, and executing with purpose. Utilities aren’t chasing buzzwords; they’re responding to real-world demands with practical innovation and long-term thinking. It’s not about being flashy—it’s about being relevant. As technologies evolve and expectations rise, the utilities that stay grounded in their mission and open to possibilities will shape the future. The bar is high—and the opportunity is even higher. The question is: Who’s ready to meet it?
