The utility industry is at a critical juncture in 2026. Utility leaders are grappling with an aging grid, accelerating failure rates and constant budgetary pressures, all while navigating the challenges of immense load growth and extreme weather events.
This creates a precarious operating environment with a persistent concern: how to maintain system integrity with limited resources. For many system operators, the thing most likely keeping them awake at night is the risk of catastrophic failure. But what if the greatest risk lies not in the physical assets or budget, but in the utility’s strategic approach to capital planning?
Shifting From the Classic Operations Approach
Utilities have long operated with a segmented approach to asset management. Capital investments are managed on a project-by-project basis, while operations and maintenance (O&M) work is purely reactive. This approach, driven by siloed budgets and a fix-when-it-breaks philosophy, creates significant operational blind spots. It wastes scarce resources and leaves the grid vulnerable to systemic risks.
For example, a utility dispatching a crew to replace a single failed overhead transformer could be missing out on efficiencies if it had realized the entire feeder was experiencing significant voltage sag due to new loads, making future failures on that same circuit inevitable.
While each individual project or work order might seem justified, an uncoordinated portfolio of activity can lead to a cascade of unmanaged risks across the entire grid. Given the sheer size and growth rate of the electric grid and customer demands for reliability, that situation is no longer tenable.
The solution is a fundamental shift in perspective: from controlling costs on individual projects to optimizing investment across the entire asset life cycle. By moving to a systemwide approach, utilities can transform their capital and O&M plan from a list of expenditures into the primary engine for driving reliability, resiliency and long-term value. Projects are prioritized based on total value delivered. Emergency cable repairs are supplanted by proactive, data-informed cable replacement projects that target entire segments with a high probability of failure. Reactive replacement programs turn into risk-based resiliency strategies with feedback loops on what is working for the betterment of customers. Efficiencies are gained in every step of utility operations, from planning to procurement to construction.
Implementing a Data-Driven Framework
Forward-thinking utilities are making this shift by partnering with execution-focused professionals. These utilities are implementing data-driven program management frameworks that integrate data from the geographic information system (GIS), outage management system (OMS) and work management systems into a single platform. This connects real-world asset conditions directly to effective investment strategy and execution excellence. This creates a powerful feedback loop — a virtuous cycle of improvement — seeing that every dollar and every crew hour is directed with precision to strengthen circuits and components with optimal impact for customers and operations.
The outcome is a new level of certainty and control. By embracing this strategic transformation, utilities can move from reactive repairs to proactive management, armed with a defensible, data-driven plan that delivers better outcomes both for customers and balance sheets. Challenges facing the industry are immense, but a clear path forward exists.