AI in utilities allows providers to enhance customer support, streamline operations and meet fluctuating demand. Discover the benefits and challenges of using AI in utilities along with 8 real world examples that utility providers can learn from today.
Artificial intelligence in energy and utilities is redefining the future of water, power, and gas providers in the U.S., and already it’s changed how many operate today.
From handling surging customer inquiries during outages to optimizing grid operations and predicting renewable energy supply, AI in utilities is helping organizations meet the demands of modern customers, manage increasingly complex infrastructure, and comply with ever-tightening regulations.
In this article, we’ll break down the core benefits of using AI in utilities and critical challenges to successful implementation, along with sharing real-world examples of how utility companies are using AI to solve operational pain points and offer better service.
What is AI in utilities?
AI in utilities refers to a set of technologies that enable utility leaders to automate and streamline customer support, outage reporting, grid monitoring, and more. AI in the utility industry can enhance customer experiences while lowering operational costs for providers.
What are the benefits of AI in utilities?
Unpredictable surges in demand and customer calls; mountains of regulatory documents and company policies; outdated, disconnected systems.
These are just a few of the challenges that utility companies and their customers face. Luckily, AI is becoming more and more versatile every day. Let’s explore some of most tangible benefits of AI across the utilities and energy sectors:
Enhanced customer support operations
How do I pay my bill? Is there an outage? I need help resetting my account password.
Customer support teams for utilities companies hear the same questions every day. These calls are repetitive, expensive, and time-consuming—taking time away from both the employee who answers them and the next customer in line. And with 90% of customers saying that an “immediate” response time of 10 minutes or less is very important to them. Being able to meet this expectation is crucial for utilities businesses in gaining and maintaining consumer trust.
But AI-powered virtual agents can manage these inquiries efficiently at scale, lowering call volume, speeding up resolution times, and freeing up teams to focus on higher-value tasks.
Scalable customer service
Inclement weather and sudden outages guarantee one thing: high call volume. AI acts as a digital front line: handling surges in demand during spikes with 24/7 virtual agents. This way, your customer support team can keep wait times low and service quality consistent—without the need for extra staffing.
Superior accuracy and reduced errors
A billing error is frustrating. A mistake in outage information can be dangerous. AI systems deliver consistent, policy-driven answers to teams, consolidating knowledge in one knowledge base system so it’s always up-to-date, accessible, and accurate. This reduces the risk of human error and improves customer trust.
Omnichannel communication
Today’s customers are on-the-go. They expect companies to know who they are, why they’re calling, and how to help. Omnichannel AI support tools connect chat, voice, SMS and email to ensure that wherever and however customers are calling, they can get quick, accurate support. Meanwhile, support agents are able to spend more time on higher-tier requests.
What are the challenges of AI in utilities?
AI in the utility industry may be powerful, but adopting it isn’t always simple. Utility providers must contend with decades-old infrastructure, strict regulations, and customer concerns about accuracy and trust.
These hurdles can slow down deployments, create hesitation among employees and make it difficult to scale across the organization. Here are some of the most pressing challenges utilities face when adopting AI:
Integration with legacy systems
Many utilities still rely on decades-old technology to manage billing, outage reporting or routing. Connecting AI to these outdated systems can be complex and costly, often requiring extensive IT expertise, new infrastructure investments and change management to achieve full ROI.
Data privacy and security
Utilities handle sensitive customer data, from payment information to service addresses. AI adoption brings additional risk if strict security and compliance standards aren’t met. Protecting data while ensuring accessibility and usefulness is one of the industry’s top challenges.
Demand for accuracy and trust
When a storm knocks out power, customers need clear, reliable updates. Incorrect outage timelines or restoration details can quickly erode trust, and in some cases, create real safety risks. AI tools must be rigorously tested and monitored to deliver accuracy every time.
Regulatory barriers
The utility industry is one of the most heavily regulated in the U.S. Even when a team is ready to use AI in their operations, regulatory approvals and documentation requirements can slow deployment, adding extra layers of complexity to rollout plans.
Internal resistance and change management
Speaking of teams, there might be mixed feelings about using AI at work. For many, AI can feel like a threat rather than a tool they can use. Teams may worry about job security or struggle to adapt to new processes and technologies.
Successful adoption requires transparent communication, accessible training, and a clear understanding that AI is there to support, not replace, human workers.
How is AI used in the energy sector?
Utility providers worldwide use AI to automate customer support, monitor grids and predict demand, and optimize scheduling. Here are seven real-world examples of how utility companies are using AI to improve their operations:
1. Customer support automation
Real-World Example: SECO Energy
SECO Energy, serving 220,000 members in Florida, faced surging call volumes and customer frustration during outages and peak demand events. The company deployed Capacity’s AI-powered virtual agents and chatbots to instantly address routine service questions, billing inquiries, and outage reports.
Results:
- 66% reduction in cost per call
- 32% call volume deflection
- 4.5/5 call satisfaction score
👉 See how SECO Energy modernized their support operations with AI.
2. Outage reporting and communication
Long call wait times, by definition, happen at the worst times. Outages or scheduled maintenance often lead to customer frustration, support demand spikes, and heavy workloads. By implementing AI-powered virtual assistants across channels, utilities can enable customers to:
- Report outages and service disruptions instantly
- Receive proactive updates on restoration timelines via automated SMS and voice notifications
- Have complex cases efficiently routed to human assistance when needed
Benefits:
- Vastly shorter wait times
- Improved customer communication and sentiment during critical incidents
3. Field service and roadside scheduling
Real-World Example: AAA
AAA provides roadside service to more than 60 million drivers across North America. Long hold times kept frustrated drivers waiting while call spikes overwhelmed agents. With Capacity’s virtual agents, AAA can provide immediate, personalized assistance, while lowering support costs.
Results:
- 30 million calls handled by virtual agents
- 66% savings per call
- 4.5/5 customer satisfaction score
88% of field service companies that implement AI in their operations improve asset uptime, reduce service costs and increase overall customer experience—so it’s worth it to invest.👉 Want to learn more? Read the full AAA case study.
4. Agent assist and knowledge base
Utilities leveraging technology like an AI-powered knowledge base, or agent assist tools, can empower support teams to quickly access company protocols, outage procedures, and customer information—right during live conversations. Integrated generative AI capabilities suggest next-best actions and automate call notes.
Benefits:
- Reduced average call times
- Greater accuracy and compliance
- Improved agent confidence and lower training burdens
5. Modernizing voice and IVR systems
Legacy phone menus can be clunky, frustrating, and often wrong. Utility companies can replace a traditional IVR with conversational AI, leveraging tools like voice biometrics, speech recognition and sentiment analysis. Customers now speak naturally to report leaks, pay bills, or check account status—without long hold times or confusing prompts.
Benefits:
- Higher first-contact resolution
- Increased customer satisfaction
- Lower call abandonment rates
6. Proactive alerts and notifications
Real-World Example: Culligan Water
Culligan is a global leader in high-quality water solutions, servicing over 150 million people each year in 90 countries. As part of a digital transformation to stay competitive, Culligan partnered with Capacity to turn more website visitors into leads while simplifying appointment scheduling. With SMS virtual agents, customers can schedule appointments 24/7 across the entire dealer network.
Results:
- 3000+ appointments scheduled through the AI bot in the first 2 months
- $650,000 already generated from those appointments
- 50+ appointments scheduled over weekends that would have been missed
👉 Learn more about Culligan’s SMS virtual agents. Read the full story.
7. Smart grid monitoring and renewable forecasting
Energy demand is climbing, set to grow 25% by 2050. Being able to forecast demand and grid load is essential for any utility providers. By leveraging AI and machine learning models, utilities can analyze smart meter data, predict demand and optimize grid load.
Benefits:
- Autonomous grid management and load balancing
- More accurate forecasting and supply planning for renewables
Looking ahead: the future of AI in utilities
AI in the utility industry is moving toward advanced, autonomous operations—where grids self-manage, outages are instantly rerouted, and customer experiences are continuously improved. The next frontier? Generative AI, offering utilities the tools to create personalized communications, automate regulatory reporting, and support sustainable goals at scale.
Utilities embracing artificial intelligence in energy and utilities today are laying the foundation for a smarter, more resilient future.
FAQs
AI enables demand forecasting, pure grid management, outage communication, resource optimization, and predictive maintenance in the energy sector.
AI accelerates the shift to renewables by supporting dynamic forecasting, resource balancing, and emissions reduction strategies.
AI analyzes streaming sensor data from smart grids, predicts failures, and automates outage handling for improved reliability
Successful utilities prioritize automation of repetitive tasks, integration with legacy systems, and compliance, alongside robust agent assist and knowledge base deployment.