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US-based National Grid Partners has released the results of its 2025 Utility Innovation Survey, which show nearly two-thirds of utility leaders have seen increased innovation budgets in the past year.
The survey, now in its second year, gathered perspectives from 166 industry leaders and shows the sector is accelerating the implementation of innovation.
Also, results show that nearly all (96%) view artificial intelligence as a strategic focus, although there are several key factors hindering deployment, with a significant skills gap being chief among them.
Steve Smith, president of National Grid Partners and Chief Strategy and Regulation Officer at National Grid, commented on the survey: “Our findings are clear: Utilities have gotten the message and are putting their budgets to work to rapidly embrace innovation, deploy AI and build a more dynamic grid.”
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Additional highlights from the report include:
- 69% of respondents say innovation now is embedded across all business units. That’s a notable shift from 2024, when 66% said innovation at their companies was structured as a centralised corporate function.
- 42% of utility leaders reported working with startups to spark innovation; last year, just 26% of those surveyed said they identified fresh ways of thinking from startups.
- Utility leaders reported a 33% increase from last year’s survey in the percentage of innovation projects that move from the drawing board to implementation (32% vs 24%).
- After the talent gap, data privacy (65%), high implementation costs (64%) and integration with existing systems (39%) were cited as the top blockers to AI deployments.
- This year, grid modernisation surged to the forefront of utility agendas (from 6% in 2024 to 40% in 2025).
AI strategic focus
While 96% of respondents view AI as a strategic priority, only 4% say their companies have a mature, well-funded AI programme.
Many (42%), however, plan to deploy AI within the next two years, targeting use cases such as regulatory reporting, compliance, worker training and remote equipment monitoring.
National Grid Partners highlights the unique position of utilities as both users of AI and power providers to AI data centres. AI will provide the tool utilities will need to improve operational efficiency and ultimately adopt new strategies needed to meet the growing power demand of AI and data centres.
Research for the 2025 Utility Innovators Survey was conducted from 5 June to 30 July 2025, through an online survey prepared by Method Research .
