What's Happening?
Artificial intelligence (AI) is increasingly being integrated into the operations of electric utilities across North America, with over 80% of utilities reporting some form of AI usage. However, many AI initiatives struggle to deliver lasting results due to a lack of integration into core operational frameworks. These initiatives often remain as pilots, failing to scale and demonstrate return on investment (ROI) within the reliability and financial frameworks that utilities are accountable to. Common issues include AI projects being isolated from capital planning, unclear operational ownership, and a focus on activity rather than measurable impact. To overcome these challenges, AI must be treated as an operational capability, integrated into existing
planning and oversight processes, and evaluated based on its effect on reliability and affordability.
Why It's Important?
The integration of AI into utility operations has the potential to significantly enhance reliability and efficiency, but only if managed with the same rigor as other operational capabilities. When AI is treated as a standalone innovation, it risks being sidelined and failing to deliver value. By embedding AI into core utility operations, utilities can ensure that AI initiatives contribute to improved service reliability and cost management. This approach not only strengthens the utility's operational capabilities but also builds trust with regulators and stakeholders by demonstrating measurable performance improvements.
What's Next?
Utilities that successfully integrate AI into their operations will likely see improved performance metrics and greater regulatory support. Executives play a crucial role in this process by prioritizing AI in capital planning and demanding outcome-based measures. As AI becomes more embedded in utility operations, it will be essential for utilities to continuously evaluate and refine their AI strategies to ensure they align with operational goals and regulatory requirements.
