Climate change is reshaping our world, bringing unprecedented challenges like extreme weather events, rising sea levels, and severe droughts. As we strive to reduce carbon emissions and overhaul infrastructure, utilities play a crucial role in redefining how we generate, distribute, and consume energy.
The global power grid, an aging and often unreliable system, must be transformed to support a decentralized model powered by renewable energy. Utilities are redefining how we generate, distribute, and consume energy, and exploring the technologies and business practices that will get them there.
We’ve identified the top 3 goals every utility should include in their strategy to reconfigure the old business model to support the new:
Goal 1: Re-balance Supply and Demand
Balancing supply and demand is a fundamental challenge for utilities. As renewable energy sources like solar and wind become more prevalent, the balance must be re-engineered. The future grid will treat both load and supply as variables, requiring new strategies to influence energy consumption patterns.
Challenges:
- The current grid struggles to support global energy demand
- Increasing consumption from electric vehicles, heat pumps, and data centers adds unpredictability
- Blackouts are becoming more frequent more significant events
What’s working in technology and business practices:
- Cloud-based, AI-powered solutions: Over 82% of utilities see AI as essential for digital transformation, helping reduce complexity and costs
- Communication: Effective customer communication can prevent grid failures
- Managed energy consumption: Flexible energy or demand response programs incentivize off-peak energy use, balancing the load
Goal 2: Strategic Asset Investments
The global power grid is vast and aging, requiring constant maintenance and innovation. Rebuilding the grid involves significant investment in new infrastructure while maintaining existing operations.
Challenges:
- Finding replacement parts for outdated infrastructure is difficult
- Insufficient funding leads to degraded assets and increased risk
- Climate change exacerbates grid failures, as seen in the 2024 Balkan heatwave and North American weather events
What’s working in technology and business practices:
- Asset management and performance: Real-time data and predictive maintenance extend asset lifecycles
- Data-based insights: Decision-making models and artificial intelligence (AI) help prioritize critical infrastructure investments
- Industry collaboration: Utilities must work together, sharing goals and constraints to establish new benchmarks
Goal 3: A Strong and Dynamic Workforce
Utilities face a global talent shortage, with over 70% reporting difficulties in hiring. Attracting and retaining skilled workers is essential for future-proofing the grid.
Challenges:
- An exodus of workers, exacerbated by the Great Resignation of 2022
- Loss of experienced employees nearing retirement
- Lack of interest from younger workers who view the industry as outdated
What’s working in technology and business practices:
- Increased workforce productivity: Mobile workforce management and maintenance planning optimize operations
- Shared experience: Mentorship programs and remote assistance technology help transfer knowledge from senior to junior employees
- Collaboration with educational institutions: Partnerships with universities can attract top graduates and influence curricula to meet industry needs
The transformation of the global power grid is an urgent and monumental task. Utilities must innovate and adapt, investing in new technologies and infrastructure while fostering a dynamic workforce. By embracing these changes, we can build a resilient, sustainable grid that meets the demands of the future.
