The vast and vital global power and utilities industry is undergoing a significant transformation. Over the past 30 years, electricity and gas markets have been radically reshaped, thanks to newly opened markets, disruptive competitors and technologies, and the evolution of customers from passive consumers to active participants with high expectations.

The power and utilities sector, which underpins every other industry, has traditionally focused on long-lived assets and gradual policy shifts. As a result, it has adopted changes in a piecemeal, deliberate, and sometimes regulatory-constrained fashion and is not accustomed to an accelerated pace of change. But decarbonization, decentralization, and digitization are creating a new three-dimensional challenge — and impelling faster evolution. Amid rising market uncertainty and increasing pressure on traditional fossil fuel generation, the world’s largest utilities are shifting investments from large-scale power supply into the network. New value pools are forming in areas as diverse as energy management, electric car charging, and home automation. And instead of simply charging a fixed price to deliver electricity, utilities are rolling out pricing models and services more closely associated with consumer goods and industrial companies.

The result? The industry is in the midst of extraordinary strategic ferment, as companies evaluate how they will compete in the future. Some global utilities have already dramatically diverged from their former identities.

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