From Evolution to Revolution: How Public Power Navigates Change

Navigating a New Pace of Change

Thirty years ago, change in our industry moved at a measured, linear pace. Regulatory initiatives unfolded over years, and utilities adapted. Today’s change is different. It’s revolutionary — driven by technology, customer engagement and unprecedented large-load growth — while compounded by policy uncertainty, longer timelines and workforce constraints.

For public power systems tasked with serving communities reliably and affordably, the stakes couldn’t be higher. There is also a compounding effect of so many challenges emerging at once. In addition, utilities are being asked to deliver reliability and affordability in a context where the timelines, incentives, and rules are not well-aligned.

Industry Challenges and Constraints

• Policy uncertainty: The lack of a coherent, durable national energy policy makes long-lived (40-plus years) investments more difficult. Policy preferences swing like a pendulum, shifting the “rules of the road” in ways that introduce planning risk and push resource decisions away from those who are responsible for serving load.
• Regional transmission organization (RTO) rule misalignment: Some market rules were designed for different conditions and are now showing their limitations. When the underlying drivers change, the cracks in assumptions surface.
• Permitting and interconnection: Complex, multi-jurisdictional processes are slow and often conflicting — slowing the development of both new generation and essential transmission.
• Supply chain and costs: Longer equipment lead times and higher capital costs collide with the increasing demand for electricity, which is accelerating at a faster pace than can be reasonably met.
• Workforce and new skill sets: From lineworkers to management, retirements and competition for talent are real across the industry. Meanwhile, data integration, analytics and controls require new expertise and skill sets that employees must develop if they don’t already have. We are also witnessing a shorter replacement cycle for technology — as soon as we adapt to one new piece of technology, another new one is developed.

Reliability and resource adequacy are often in the news because a data center can move from the announcement to a finished facility in roughly a year once approvals are in place. However, transmission upgrades to serve that same load can take four to eight years, and new baseload generation can take six to eight years, or even longer for the development of nuclear power.

Real progress to address this mismatch will require practical, bipartisan permitting reform, cross-jurisdictional coordination, and the modernization of processes. Transmission can be a temporary bandage but ultimately, the system needs capacity along with the time to design it, get it approved and then build it.

The growth in large loads, especially data centers and AI-related demand is real. The public power imperative is to be pro-growth and risk-aware at the same time, protecting existing customers while considering economic development.

Planning for Growth While Protecting Communities

Public power is often seen as nimble and we want to be constructive partners. But public power is not in a position to overbuild on speculative projections. Therefore, it’s important that agreements are put in place that follow cost causation and protect public power communities and the existing customer base.

Public power’s advantage is long-horizon planning and community alignment. Public power utilities focus on the communities they serve, making sure they have reliable, affordable power for everyone while still serving growth and development.

Disruptors, by definition, are hard to predict. A decade and a half ago, few anticipated how fracking and an economic downturn would abruptly change market dynamics. Today, we’re seeing multiple new disruptors — AI-driven demand, evolving technologies and the reemergence of reliability concerns — arrive simultaneously.

Public power utilities will continue to focus on the communities they serve, making sure they have reliable, affordable power for everyone while still serving growth and development. That means disciplined planning, risk-aware contracts, collaborative problem-solving, and relentless focus on their customers.