The energy and utilities (E&U) industry must transition while it’s still an option. AI is proving value in an old sector during the push for optimization and continued (yet too slow) decarbonization. However, transition planning is nowhere near the level it should reach (see our call to action). There’s still time to lead as an individual, team, or firm across emerging tech and sustainability. Make it personal. Be part of the systems change, whether you’re an E&U individual, team, or whole organization in an enterprise or service provider.
The 2025 HFS Research Horizons study for the E&U sector assessed 23 leading consulting, technology, and business service providers (see Exhibit 1). That study examined the providers’ value propositions (the why), execution and innovation capabilities (the what), go-to-market strategy (the how), and market impact criteria (the so what). Horizon 3 firms show market and systems-changing leadership. Horizon 2 firms powerfully work across organizational silos. Horizon 1 firms execute efficiently. The E&U services market is also growing: revenues, headcounts, and client numbers grew 44%, 36%, and 17%, respectively, over the past three years.
Exhibit 1: E&U’s technology and sustainable transitions mean an economically, socially, and environmentally pivotal role for consulting, technology, and services companies
The E&U industry is being reshaped and it’s a bumpy process—sometimes it seems rapid; other times, much less so
That disruption goes beyond addressing the climate emergency and energy transition. Emerging technologies, including AI, physical-digital combinations such as grid upgrading, and outcomes such as creating genuinely positive customer experiences (CX) are also top of mind for enterprise business and technology teams.
The sphere of influence is massive for all services firms. But does the ambition match?
The Horizons report includes detailed profiles of each service provider, outlining their numbers, strengths, and development opportunities. The report is global in scope and helps enterprises of all shapes and sizes, service providers offering E&U services, and ecosystem partners.
The CIO agenda and how efficiency drives AI, emerging technology, and the energy transition
The E&U industry is focused on efficiency above all else. This clarity is an unmissable opportunity to align the technology suite, including AI in its various forms, toward shared goals throughout organizations and ecosystems such as optimization and decarbonization (we deep dive here). The industry also needs clarity from its CIOs. To target efficiency, tech, systems, and processes must connect, with security ensured and innovation maximized (we outline this agenda here).
The industry talent crisis continues—it must transition while still being an option
E&U enterprises are calling for transition planning across sectors (we highlight here). The industry should transition while ‘leading’ is still an option (we called for this in launching the study). Collectively, as an industry, we must improve our ability to communicate the benefits to the planet, people, and business. The energy industry has also faced a decade-long talent problem connected to its unsustainability. The sector is not seen as high-tech either. Energy needs new, ambitious, and diverse talent to address the climate and sustainability emergency and adapt to technologies such as AI (we assess how E&U can find its best self here).
The utilities vision is a positive, proactive CX; digital grids also see investment but need collaboration
Utilities must go beyond providing a neutral CX. Combinations of emerging technology, including smart meters and GenAI, will win out by producing new positive CX and outcomes for customers—and doing so proactively. Enterprises—from water to electricity providers—are incorporating these technologies and new processes to move toward better experiences, but none are yet truly in the positive camp. Some are gearing up to target that camp. But most utilities are struggling with their existing systems that a net-neutral CX is the best they can currently hope for.
Demand is also not reaching a critical mass in EV or broader distributed energy networks. Governments are struggling to find the necessary investments for grid infrastructure. E&U enterprises will have to pick up the tab. Better that tab be picked up in public-private partnerships to make sure the upfront cost of the energy transition does not fall on the least advantaged through large increases to energy and water bills. History suggests that a monumental change in approach is needed to avoid such an unjust outcome. A lack of system collaboration among tech, regulators, industry, and consumers hampers new successful market design.
DeepSeek is setting new expectations regarding training and related costs, and we expect market leaders to respond.
Voice of customers and partners
Co-innovation with major industry clients is a clear differentiator for leading services firms, alongside expected themes such as execution and existing relationships. The depth of domain knowledge stands out among providers that use a similar language. Ambition for systems-changing AI and sustainability also separates the best from the good.
The Bottom Line: To ensure a successful transition, E&U enterprises must attract the best talent before they’re dragged by systemic change. The services market is expanding to meet this challenge but has much more orchestration and collaboration to master.
This Horizons study examined the E&U industry’s overall story: enterprises must improve their transition plans and ecosystem collaboration; maximize innovation and ensure security through new, clear governance; address a continued talent crisis; and find new positive proactive customer experiences.
The analysis also outlines how the consulting, technology, and services industry must enhance its ecosystem orchestration and co-innovation with systemically important companies that can drive the systems change that technology and the energy transition need.
HFS subscribers can download the report here
Posted in : Artificial Intelligence, Climate Cange, Customer Experience, Energy, Energy and Utilities, HFS Horizons, sustainability, TalentCrisis, Utilities & Resources
