{"id":768986,"date":"2026-02-02T11:03:00","date_gmt":"2026-02-02T16:03:00","guid":{"rendered":"https:\/\/www.capgemini.com\/us-en\/?p=768986&#038;preview=true&#038;preview_id=768986"},"modified":"2026-10-29T11:05:20","modified_gmt":"2026-10-29T16:05:20","slug":"utilities-see-major-growth-opportunities-in-the-ai-driven-energy-boom","status":"publish","type":"post","link":"https:\/\/www.capgemini.com\/us-en\/insights\/expert-perspectives\/utilities-see-major-growth-opportunities-in-the-ai-driven-energy-boom\/","title":{"rendered":"Utilities see major growth opportunities in the AI driven energy boom"},"content":{"rendered":"\n<header class=\"wp-block-cg-blocks-hero-blogs header-hero-blogs\"><div class=\"container\"><div class=\"hero-blogs\"><div class=\"hero-blogs-content-wrapper\"><div class=\"row\"><div class=\"col-12\"><div class=\"header-title\"><h1>Utilities see major growth opportunities in the AI driven energy boom<br><sup>But our research shows they will need to transform to capture the value<\/sup><\/h1><\/div><\/div><\/div><\/div><div class=\"hero-blogs-bottom\"><div class=\"header-author\"><div class=\"author-img\"><img decoding=\"async\" src=\"https:\/\/www.capgemini.com\/us-en\/wp-content\/uploads\/sites\/30\/2024\/04\/Hariharan-Krishnamurthy.jpg?w=200&amp;quality=10\" alt=\"\" loading=\"lazy\"\/><\/div><div class=\"author-name-date\"><h5 class=\"author-name\">Hariharan Krishnamurthy<\/h5><h5 class=\"blog-date\">Feb 2, 2026<\/h5><\/div><\/div><div class=\"brand-image\"><img decoding=\"async\" loading=\"lazy\" src=\"\/wp-content\/themes\/capgemini2025\/assets\/images\/capgemini-engineering-white.svg\" alt=\"capgemini-engineering\"\/><\/div><\/div><\/div><\/div><\/header>\n\n\n\n<section class=\"wp-block-cg-blocks-group section section--article-content\"><div class=\"article-main-content\"><div class=\"container\"><div class=\"grid-container\"><div class=\"col-12 col-md-2\"><nav class=\"article-social\"><ul class=\"social-nav\"><li class=\"ip-order-fb\"><a href=\"https:\/\/www.facebook.com\/sharer\/sharer.php?u=https:\/\/www.capgemini.com\/?p=1191860\" target=\"_blank\" rel=\"noopener noreferrer\" title=\"opens in a new window\"><i aria-hidden=\"true\" class=\"icon-fb\"><\/i><span class=\"sr-only\">Facebook<\/span><\/a><\/li><li class=\"ip-order-li\"><a href=\"https:\/\/www.linkedin.com\/shareArticle?url=https:\/\/www.capgemini.com\/?p=1191860\" target=\"_blank\" rel=\"noopener noreferrer\" title=\"opens in a new window\"><i aria-hidden=\"true\" class=\"icon-li\"><\/i><span class=\"sr-only\">Linkedin<\/span><\/a><\/li><\/ul><\/nav><\/div><div><div class=\"article-text article-quote-text\">\n<p class=\"wp-block-paragraph\">Demand for electricity is accelerating at a pace the industry hasn\u2019t experienced in decades. Much of this surge is being fueled by the rapid rise of artificial intelligence (AI), alongside the longer-term trend of electrifying everything from transportation to heavy industry. Data centers, electric vehicles, and digital infrastructure are all competing for power and competing urgently.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Utilities had a standout year in 2025. But, as demand climbs even higher, they will need to scale capacity just as quickly. The immediate rewards are clear: sustained growth and rising revenues. Yet, the larger story is the critical role utilities will play in enabling national competitiveness in AI and advancing the broader energy transition.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">The road ahead is as promising as it is uncertain. The opportunities are significant &#8211; but so are the constraints.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">The Capgemini Research Institute\u2019s <a href=\"https:\/\/www.capgemini.com\/insights\/research-library\/engineering-research-development-pulse-2026\/\">Engineering and R&amp;D Pulse Report 2026 <\/a>(hereafter \u2018<em>Engineering Pulse\u2019<\/em>) highlights several structural barriers that could limit the industry\u2019s ability to expand capacity rapidly and cost effectively. These include the high cost of asset upgrades, compounded by ongoing global supply chain volatility, as well as a persistent shortage of engineering talent needed to deliver them.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Energy leaders recognize the challenges. The question now is: are they ready to meet them?<\/p>\n\n\n\n<h2 id=\"h-the-challenges-ahead\" class=\"wp-block-heading\">The challenges ahead<\/h2>\n\n\n\n<p class=\"wp-block-paragraph\">Cost pressures have become one of the defining constraints on grid upgrades and expansion. 62% of energy leaders say that costs have risen significantly in recent years, and more than 80% say they must achieve 10\u201315% cost improvements in the next two to three years, simply to remain competitive.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">This view is backed by <a href=\"https:\/\/www.iea.org\/news\/rising-component-prices-and-supply-chain-pressures-are-hindering-the-development-of-transmission-grid-infrastructure\" target=\"_blank\" rel=\"noreferrer noopener nofollow\">the IEA, which recently noted<\/a> \u201c<em>Prices and procurement times for essential components like power transformers and cables have almost doubled in four years, creating significant hurdles for grid developers.\u201d<\/em><\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Compounding this challenge are external pressures: roughly two thirds of respondents cite tariffs, trade barriers, and supply chain disruptions as major factors impacting their engineering and R&amp;D operations, driving up both costs and project timelines.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">At the same time, utilities are confronting a widening talent gap. More than half identify a shortage of skilled engineering talent as a key barrier to lowering costs and accelerating time to market. An aging workforce, intense competition for digital skills, and restricted access to global talent pools are all constraining execution just as investment needs surge.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">And if utilities cannot deliver affordable, reliable energy on scale, others may step in. 62% of leaders see nontraditional entrants as a major threat. Data center operators, for example, are already investing in microgrids and signing contracts with providers of off grid power solutions &#8211; from solar to emerging fusion technologies. These developments represent both risks and opportunities, with utilities playing a key role in such endeavors, if they have the infrastructure to integrate them.<\/p>\n\n\n\n<h2 id=\"h-utilities-are-rethinking-how-they-deliver-engineering\" class=\"wp-block-heading\">Utilities are rethinking how they deliver engineering<\/h2>\n\n\n\n<p class=\"wp-block-paragraph\">To meet rising and rapidly evolving demand, while keeping cost and risk under control, utilities cannot rely on traditional ways of working. Engineering and R&amp;D models must be reimagined for scale, speed, and efficiency.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Encouragingly, most utilities are taking meaningful steps. A strong majority (84%) are investing in digital modernization, and many plan to increase that investment in the near term. However, only 20% have begun reorganizing and streamlining engineering operations, even though 70% say such changes are on their roadmap. These digital and organizational shifts will be essential to unlocking the productivity gains required to expand capacity cost effectively.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">AI adoption, meanwhile, remains cautious: just 24% of utilities are deploying AI today, far below most industries in our survey. Still, three quarters expect to increase AI investment in the coming years. In a high stakes environment, a measured approach is understandable, but the potential for AI to enhance efficiency and accuracy means the industry will need to act soon.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Perhaps the clearest indicator that a new model is taking shape is the rising interest in global delivery. Historically, utilities have been regional employers, hesitant to offshore critical engineering work. But this model is no longer meeting talent or cost needs.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Today, 73% of respondents say they are using offshore Global Capability Centers&nbsp;to access scarce skills and improve cost predictability. Interestingly, this mirrors the evolution the oil and gas sector went through over a decade ago, as it faced similar pressures to transform.<\/p>\n\n\n\n<h2 id=\"h-a-model-built-for-stability-is-now-under-strain\" class=\"wp-block-heading\">A model built for stability is now under strain<\/h2>\n\n\n\n<p class=\"wp-block-paragraph\">For decades, utilities have benefited from long investment cycles, predictable planning horizons, and an operating culture centered on safety, reliability, and regulatory compliance. These foundations have served the industry well, ensuring secure and dependable service for millions.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">The <em>Engineering Pulse<\/em> findings reflect this legacy. Safety and compliance remain the dominant priorities, cited by 77% of respondents. Agility, by contrast, ranks much lower at 56%, significantly below sectors such as automotive, where rapid iteration and responsiveness are embedded into the operating model.<\/p>\n\n\n\n<figure class=\"wp-block-table\"><table class=\"has-fixed-layout\"><tbody><tr><td><strong>Strategic priorities over the next 12\u201318 months<\/strong><\/td><td><strong>% saying important<\/strong><\/td><\/tr><tr><td>Cost savings<\/td><td>62%<\/td><\/tr><tr><td>Time to market acceleration<\/td><td>67%<\/td><\/tr><tr><td>Innovation and value creation using digital technologies<\/td><td>63%<\/td><\/tr><tr><td>Operational efficiency<\/td><td>41%<\/td><\/tr><tr><td>Scalability of engineering capacity<\/td><td>45%<\/td><\/tr><tr><td>Agility and resilience<\/td><td>56%<\/td><\/tr><tr><td>Sustainability<\/td><td>51%<\/td><\/tr><tr><td>Safety and regulatory compliance<\/td><td>77%<\/td><\/tr><\/tbody><\/table><\/figure>\n\n\n\n<p class=\"wp-block-paragraph\">Utilities are now being pushed by external forces to move far faster than their traditional rhythms allow. AI data centers cannot wait years for grid upgrades. Digital technologies that could reduce time and cost cannot be fully deployed under today\u2019s cautious, incremental approach. And utilities cannot hope to hire the tens of thousands of engineers required for this buildout while relying on geographically constrained delivery models.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Survey respondents acknowledge this reality. Many point to a weak innovation culture as a material barrier to progress. The industry has long optimized for perfection over speed, an understandable stance in a mission critical sector where safety and reliability are paramount. But that \u2018slow and steady\u2019 mindset now limits innovation, constraining cost reductions, and delaying urgently needed infrastructure upgrades at precisely the moment the system requires accelerated action.<\/p>\n\n\n\n<figure class=\"wp-block-table\"><table class=\"has-fixed-layout\"><tbody><tr><td><strong>Barriers to reducing costs, accelerating time to market, and scaling effectively<\/strong><\/td><td><strong>% saying major challenge<\/strong><\/td><\/tr><tr><td>Insufficient budget or investment<\/td><td>62%<\/td><\/tr><tr><td>Lack of skilled talent<\/td><td>66%<\/td><\/tr><tr><td>Legacy systems or outdated technology<\/td><td>56%<\/td><\/tr><tr><td>Organizational resistance to change<\/td><td>58%<\/td><\/tr><tr><td>Supply chain constraints<\/td><td>68%<\/td><\/tr><tr><td>Regulatory or compliance challenges<\/td><td>56%<\/td><\/tr><tr><td>Weak innovation culture<\/td><td>60%<\/td><\/tr><\/tbody><\/table><\/figure>\n\n\n\n<h2 id=\"h-the-crossroads-moment\" class=\"wp-block-heading\">The crossroads moment<\/h2>\n\n\n\n<p class=\"wp-block-paragraph\">The message from <em>Engineering Pulse<\/em> is not that utilities should abandon caution, but rather that the current operating model alone is no longer sufficient for the market they are entering.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">The only sustainable path forward is to rethink how engineering gets done, embracing new delivery models, modern digital tools, and a culture that balances safety with speed, efficiency, and access to global talent.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Utilities that make this shift will be best positioned to convert today\u2019s Energy Supercycle into long term strategic advantage. Those who don\u2019t may find that energy leadership &#8211; across AI, electrification, and the broader transition &#8211; moves elsewhere.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\"><a id=\"_msocom_1\"><\/a><\/p>\n<\/div><\/div><\/div><\/div><\/div><\/section>\n\n\n\n<section class=\" section section--expert-slider wrapper-people-slider wp-block-cg-blocks-wrapper-people-slider undefined\"><div class=\"container\"><div class=\"row\"><div class=\"content-title col-12 col-md-8\"><h2 data-maxlength=\"34\" class=\"people-heading-title\">Meet our expert<\/h2><\/div><\/div><\/div><div class=\"slider slider-boxed\"><div class=\"container\"><div class=\"slider-window\"><div class=\"slider-list\">\t\t<div class=\"slide\">\n\t\t\t<div class=\"box\">\n\t\t\t\t<div class=\"row\">\n\t\t\t\t\t<div class=\"col-md-6 col-lg-4 box-img-wrapper\">\n\t\t\t\t\t\t<img decoding=\"async\" loading=\"lazy\" src=\"https:\/\/www.capgemini.com\/us-en\/wp-content\/uploads\/sites\/30\/2024\/04\/Hariharan-Krishnamurthy.jpg\" alt=\"Hariharan Krishnamurthy\"\/>\n\t\t\t\t\t<\/div>\n\t\t\t\t\t<div class=\"col-md-6 col-lg-8 box-inner\">\n\t\t\t\t\t\t<div class=\"row title-social-media-header\">\n\t\t\t\t\t\t\t<div class=\"col-md-12 col-lg-6 mbl-social-icon\">\n\t\t\t\t\t\t\t\t<ul class=\"social-nav\">\n\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t<li>\n\t\t\t\t\t\t\t\t\t\t\t<a class=\"subnav-button--form\" href=\"javascript:void(0)\" aria-label=\"contact us\" data-bs-toggle=\"modal\" data-bs-target=\"#WPBfb3076bc_c3f9_4b50_b6c7_1c30d32549f1\" data-bs-expert-title=\"1\">\n\t\t\t\t\t\t\t\t\t\t\t\t<i aria-hidden=\"true\" class=\"ico-form\"><\/i>\n\t\t\t\t\t\t\t\t\t\t\t<\/a>\n\t\t\t\t\t\t\t\t\t\t<\/li>\n\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t<li><a aria-label=\"Linkedin\" target=\"_blank\" title=\"Opens in a new window\" href=\"https:\/\/www.linkedin.com\/in\/hariharan-krishnamurthy\/\"><i aria-hidden=\"true\" class=\"icon-li\"><\/i><\/a><\/li>\n\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t<\/ul>\n\t\t\t\t\t\t\t<\/div>\n\t\t\t\t\t\t\t<div class=\"col-md-12 col-lg-6 box-container\">\n\t\t\t\t\t\t\t\t<div class=\"box-title\">\n\t\t\t\t\t\t\t\t\t<h3 class=\"people-profile-title\">Hariharan Krishnamurthy<\/h3>\n\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t<span>Global Head of Energy Transition and Utilities \u2013 Engineering and RD Services<\/span>\n\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t\t\t\t<div class=\"col-md-12 col-lg-6 social-box-container dkt-social-icon\">\n\t\t\t\t\t\t\t\t<ul class=\"social-nav\">\n\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t<li><a aria-label=\"Linkedin\" target=\"_blank\" title=\"Opens in a new window\" href=\"https:\/\/www.linkedin.com\/in\/hariharan-krishnamurthy\/\"><i aria-hidden=\"true\" class=\"icon-li\"><\/i><\/a><\/li>\n\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t<\/ul>\n\t\t\t\t\t\t\t<\/div>\n\t\t\t\t\t\t<\/div>\n\t\t\t\t\t\t\t\t\t\t\t\t\t<div class=\"people-info\">Hari, a seasoned leader with 25 years in Energy &#038; Utilities, drives transformation through technology. As Global Head of Industry for Energy Transition &#038; Utilities at Capgemini Engineering, he shapes strategy, fosters customer engagement, and leads solutions, large deals, and partnerships to align with market trends.<\/div>\n\t\t\t\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/div><\/div><\/div><div class=\"slider-nav\"><button class=\"slider-prev inactive\" aria-label=\"Slider-previous\" tabindex=\"-1\"><\/button><ul class=\"slider-paginator\"><\/ul><button class=\"slider-next\" aria-label=\"Slider-next\"><\/button><\/div><\/div><\/section>\n","protected":false},"excerpt":{"rendered":"<p>Demand for electricity is accelerating at a pace the industry hasn\u2019t experienced in decades.<\/p>\n","protected":false},"author":87,"featured_media":768987,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"cg_dt_proposed_to":[],"cg_seo_hreflang_relations":"[{\"uuid\":\"d1d0185c-d1ff-4e12-b935-b3843be514b5\",\"blogId\":\"30\",\"domain\":\"www.capgemini.com\",\"sitePath\":\"\/us-en\/\",\"postLink\":\"https:\/\/www.capgemini.com\/us-en\/2026\/10\/29\/utilities-see-major-growth-opportunities-in-the-ai-driven-energy-boom\/\",\"postId\":768986,\"isSaved\":false,\"isCrossLink\":false,\"hasCrossLink\":false,\"hreflang\":\"\",\"link\":\"\"},{\"uuid\":\"fb3d7837-9833-4f80-853f-bd89217dcca7\",\"blogId\":\"1\",\"domain\":\"www.capgemini.com\",\"sitePath\":\"\/\",\"postLink\":\"https:\/\/www.capgemini.com\/insights\/expert-perspectives\/utilities-see-major-growth-opportunities-in-the-ai-driven-energy-boom\/\",\"postId\":1191860,\"isSaved\":true,\"isCrossLink\":false,\"hasCrossLink\":false,\"hreflang\":\"\",\"link\":\"\",\"source\":\"cli-backfill\"}]","cg_seo_canonical_relation":"","cg_seo_hreflang_x_default_relation":"","_jetpack_newsletter_access":"","_jetpack_dont_email_post_to_subs":false,"_jetpack_newsletter_tier_id":0,"_jetpack_memberships_contains_paywalled_content":false,"cg_dt_approved_content":true,"cg_dt_mandatory_content":false,"cg_dt_notes":"","cg_dg_source_changed":false,"cg_dt_link_disabled":false,"_yoast_wpseo_primary_brand":"135","_jetpack_memberships_contains_paid_content":false,"footnotes":"","featured_focal_points":"","jetpack_post_was_ever_published":false},"categories":[1],"tags":[],"brand":[135],"service":[],"industry":[],"partners":[],"blog-topic":[404],"content-group":[],"class_list":["post-768986","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-uncategorized","brand-capgemini-engineering","blog-topic-engineering"],"cg_authors":[],"yoast_head":"<!-- This site is optimized with the Yoast SEO Premium plugin v27.7 (Yoast SEO v27.8) - https:\/\/yoast.com\/product\/yoast-seo-premium-wordpress\/ -->\n<title>Utilities see major growth opportunities in the AI driven energy boom - Capgemini USA<\/title>\n<meta name=\"description\" content=\"AI is driving a surge in electricity demand. 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