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National Grid Partners survey of U.S. utility innovation leaders finds 78% use artificial intelligence to manage rising power demand, as industry works to keep pace with rapid change
- National Grid Partners, the corporate venture capital and innovation arm of one of the world's largest energy companies, today unveiled its third annual Utility Innovation Survey. It found utilities faced with rising power demand from AI data centers increasingly are deploying artificial intelligence to manage that demand, boost reliability and cut costs.
Nearly three-fourths of utility innovation leaders surveyed (74%) say AI-driven data center load growth is impacting grid reliability. Yet even more (78%) said they're deploying or operationalizing at least one AI application to manage interconnection demand.
"The rapid growth of AI data centers is creating new operational and financial pressures for our industry, but AI also can be a significant part of the solution," said Pradeep Tagare, Interim President of National Grid Partners.
The findings were revealed at the fourth annual NextGrid Alliance Summit, where leaders from more than 50 worldwide utilities shared strategies to accelerate innovation. National Grid founded the Alliance to encourage collaboration between utilities, regulators and startups.
In another sign of the pressure AI data centers are placing on power infrastructure, the survey found grid reliability has overtaken net zero as a top industry concern. When asked to rank their organizational priorities, 73% of utility leaders placed reliability in their top three (up from 43% in 2025). Meanwhile, net-zero goals fell from 54% to 16%
The Innovation Survey also found the ability to scale solutions remains uneven. While 72% of utility leaders report increased innovation budgets this year, project deployment timelines continue to stretch: 84% of organizations now take more than a year to move projects from pilot to full rollout, up from 78% in 2025 and 66% in 2024.
As in prior years, respondents cited reasons including a dearth of workers skilled in AI and the industry's traditionally cautious culture. Most innovation spending (59%) goes toward incremental improvements, compared with just 16% directed toward transformational initiatives.
Notably, 87% of those surveyed also say returns on innovation investments are being limited by regulatory and rate-case frameworks developed before the current AI-driven demand boom. And 83% say the cost of building infrastructure to serve AI data centers is being passed on to residential customers through higher electricity bills.
National Grid this week became a founding member of the AI Energy Management Alliance (AMEA), a consortium of technology leaders Google and NVIDIA; AI startups such as Anthropic and Emerald AI; and other major utilities including RWE, Constellation, and NRG. The group will push for policies that encourage the development of flexible data centers, which can automatically reduce power usage during periods of peak demand and buffer surrounding communities from price spikes.
Emerald AI is part of the National Grid Partners portfolio. Last December, it led a pilot in the UK with National Grid and NVIDIA that found AI software could cut data center energy use during simulated grid strain by more than a third in under a minute – while still protecting the data center's most critical workloads.
"By working with startups and scaling proven innovation, utilities can better manage demand, improve reliability and support economic growth while minimizing impact on local communities," Tagare said.
In fact, the new Innovation Survey found utilities increasingly are partnering with startups for innovative technologies. The share of respondents whose companies do so rose from 28% last year to 34% in 2026. Just 1% said they have no plans to work with early stage tech companies.
National Grid Partners also announced at the NGA Summit its two latest investments in AI-related startups: Terragrit, a software platform for simulating changes to physical operations; and LineVision, whose grid intelligence platform helps utilities improve resilience and expand capacity without costly new infrastructure.
The utility industry's first and only Silicon Valley-based corporate venture capital and innovation group now has surpassed $600 million in total investment since its 2018 launch. Nearly 80% of its portfolio companies have worked with National Grid to help make its energy networks safer, cleaner, more efficient and more resilient.
National Grid Partners conducted the annual Utility Innovation report using an online survey prepared by Method Research and distributed by RepData. Responses were collected from May 20th to July 7th, 2026, from 134 innovation leaders at utility companies in the United States. To read the full report, visit www.ngpartners.com/stories.
About National Grid Partners
National Grid Partners is the venture capital and corporate innovation arm of one of the world's largest investor-owned energy companies. By providing venture investment, business development counsel and direct integration with National Grid's innovation teams, we are accelerating the future of energy and helping new technologies scale more quickly. Headquartered in Silicon Valley, National Grid Partners has offices in Boston, London, and New York. Visit ngpartners.com or follow us on X and LinkedIn.
About the NextGrid Alliance
The NextGrid Alliance (NGA) brings together the world's energy providers to ensure utility investment and innovation efforts have an industry-wide impact. The alliance includes 1,000+ senior decision-makers from more than 170 utilities in 25 countries and has facilitated more than 500 introductions between utilities and startup entrepreneurs. Learn more at ngalliance.energy.
About National Grid
National Grid (NYSE: NGG; FTSE: NG) lies at the heart of a transforming energy system. We supply electricity and natural gas to more than 80 million people in the UK, New York and Massachusetts. National Grid also is pioneering ways to modernize and decarbonize the energy system, including delivering The Great Grid Upgrade – the largest overhaul of the UK grid in generations – and building the Upstate Upgrade, the largest investment in New York's electricity transmission network for over a century. We're committed to meeting our customers' energy needs and supporting economic growth across the regions we serve – providing safe, reliable energy today and building the resilient networks of the future.
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SOURCE National Grid Partners
