Energy and water utility providers from across the United States gathered at the Cloud for Utilities 2023 Digital + Cloud Summit to learn about innovation, customer service, digital transformation, and more. With industry investment anticipated to increase by more than 33% over the next decade, generative Artificial Intelligence (AI) dominated discussions.

“Most utilities are functioning as technology companies, and we’re firm believers that most big utilities will be AI companies at some point.”

- Mike Rossi, Vice President & General Manager, Global Energy & Utilities, Neudesic

Neudesic, the 2023 Microsoft US AI Partner of the Year, joined industry pioneers from Southern California Edison, Pacific Gas and Electric Company, and Essential Utilities on a panel to discuss the industry impact of generative AI. To kick-start the conversation, we polled the nearly 100 industry leaders in attendance and received some interesting insights. Here's what we discovered.

Majority of providers don't have a plan

Statistic from poll claiming 80% of utility providers don't 'have a generative ai strategy

According to our poll, 80% of respondents don't currently have a generative AI strategy in place, meaning organizations are at a standstill.

Even if providers understand the tremendous value of deploying generative AI models could have, knowing where to start appears to be the primary challenge.

“We’ve established four pillars for diving into the generative AI space: organizational change management, governance, technology, and most importantly, the business case. It's about benefit-cost ratio and making a large impact.”

- Kurt Sweetser, Director, Southern California Edison

Lack of in-house generative AI expertise is a major hurdle

An overwhelming majority of respondents — 89% — don't believe they have the organizational skills to successfully deploy and manage generative AI.

As the panel discussed, most providers are pursuing three options:

  1. strengthen existing personnel skills,
  2. recruit from a limited pool of AI professionals, or
  3. engage external experts.

Poor data quality remains a chief concern

When asked to rank the challenges to generative AI adoption, poor data quality took the top spot.

Poor data quality ranks first among AI challenges facing Utility Providers

It makes total sense. AI models are only as good as the data used to train them. Data modernization is often the vital first step to a generative AI strategy.

Enhanced customer service is the top reason for deploying generative AI

"Customer service" was the most important benefit for 32% of respondents, followed by "efficiency, rate case, and process improvements" (26%), and "getting a competitive advantage" (23%).

The results align with other research, where 42% of utility providers saying they will use feedback to make customer experiences more personal. They are followed by improving asset management, developing new products and services, and improving safety.

Utility providers need a strong generative AI strategy

The sentiment reflects the anticipation and challenge that underlie all technological revolutions. And, like the paradigm shifts before it, those that invest early in their generative AI strategy will enjoy the compounding benefits that time provides.

There are a lot of advancements in the AI space every day. Keeping up with it can make it hard to know where to start and invest. That's why we've worked with industry leaders to develop the Azure OpenAI Jumpstart Workshop to accelerate your AI journey. The intensive half day session led by AI experts can help educate your organization about Azure OpenAI's capabilities, potential generative AI uses, and how to deploy the technology.

If you find yourself in the same boat as many of the respondents, we'd love the opportunity to be your strategic generative AI partner. To learn more or schedule your workshop, contact us now.

“We are going to break some of our process developed over the last decade from waterfall or agile ways, but generative AI is driving us to do things much faster. The idea is that what got us here won't take us forward; it's time to think differently.”

- Kurt Sweetser, Director, Southern California Edison