Article

Cutting Through the Chaos: Why Utilities Need Integrated Planning

Grid investment planning has never been more important. Strategy, operating model, and advanced analytics are key.

著者：Martha Eggenberger, Christophe Guille, Jonathan Bordas, Scott Vitter, and Alec Brown

min read


Transmission and distribution (T&D) investment planning is at an inflection point: A long list of daunting challenges, a surge in capital investment, and higher expectations from regulators and customers now require utilities to take grid planning to an entirely new level. Among the challenges: Load growth is accelerating, resilience risks and wildfire risks are rising, storms are becoming more severe, and new resources and technologies are reshaping the edge of the grid, all while the system as a whole continues to age. In response, investor-owned utilities are making massive investments of more than $1 trillion in the US alone over the next five years. That gives rise to perhaps the biggest challenge of all: ensuring that every dollar of that massive investment generates maximum value. This is not simply an aspiration: Utilities must earn the right to deploy capital given current affordability concerns (more on that below) and regulators’ and customers’ demands for increased transparency, including pushes toward outcome-based remuneration, especially in Europe. We believe utilities must respond to the challenge by adopting integrated grid investment planning, a powerful cross-functional operating model and approach to investment planning. Seven Defining Characteristics: Integrated planning delivers a scenario-based portfolio of work with clearly quantified outcomes and a regulatory narrative that ties investments to results. When implemented well, integrated investment planning can improve capital efficiency by 20% or more, support 5% to 10% operations and maintenance (O&M) savings, improve customer reliability by up to 40%, and drive better employee experience while simultaneously strengthening the case utilities present to regulators. Utilities often think they’ll achieve the benefits of integrated planning by building or deploying a new tool that optimizes investments differently than before. While newer technology can be helpful, our extensive work with clients confirms that true transformative impact comes from changing the operating model to be cross-functional and fully connected from plan origination through work execution. We see five gaps and accompanying opportunities that often determine whether integrated planning is delivering maximum value: 1. Refresh the grid strategy before building the grid plan Historically, grid plans were optimized for asset health, reliability, and load growth within a capital envelope. Today, regulators and customers expect more: resilience to extreme weather and/or wildfires, distributed energy resource (DER) enablement, decarbonization alignment, equitable outcomes, support for and protection from AI-driven growth, and, above all, affordability given the economic pressure many customers are experiencing. Therefore, rather than building a grid plan that addresses longstanding challenges by deploying an upgraded tool or process, utilities must fully confront the choices and trade-offs inherent in meeting regulators’ and customers’ demands. This approach must address critical questions, including how to balance affordability and necessary investments in reliable service (which entails key questions about capital allocation strategy) as well as what outcomes and key performance indicators will be needed to justify those investments to customers and stakeholders. Then, and only then, is it possible for utilities to move forward with a significantly improved grid planning process. As an example, in response to recent state legislation, one US utility went through a grid strategy process and redefined its goals for how investments in the distribution grid would support customer reliability, capacity growth, and the integration of DERs. Subsequent investment plans, which were built by looking across the integrated set of needs, have been fully approved by regulators in multiple cases. Given that US regulators only approved 48% of requested electric rate increases in 2025, down from 63% in 2024, this utility’s success highlights one of the major impacts of a true integrated process. Share of electric rate increases approved by US regulators 63 2024 48 2025 2. Use engineers where they add the most value Utilities are facing a scarcity of skilled labor, and that’s particularly acute when it comes to engineers, who require years of training and are often pulled in many directions as the complexity of the grid increases. In many utilities, experienced engineers spend significant effort upstream defining scopes and manually iterating plan alternatives. Integrated planning can reduce that burden and allow them to shift focus to higher-value activities, such as reviewing exceptions, refining complex cases, and validating solutions. Leading utilities we work with develop a standardized library of common investment solutions—for example, circuit-hardening packages, reconductoring options, automation configurations, or substation upgrades. They then use AI-driven planning tools to match system needs to these predefined solution sets and assemble optimized bundles that serve as planning guidance for engineers to use in detailed scoping. We’ve found that standardizing investments also yields longer-term benefits through complexity reduction, greater procurement scale, and the accumulation of delivery experience. 3. Adopt a best-in-class technology architecture Utilities should address architecture before picking tools. It’s an incredibly exciting and overwhelming time to be in T&D planning and operations. Recent innovations in sensors, operating systems, and software across the grid were on full display at DTECH, where we saw several powerful technologies demonstrated, including AI-forward applications. Given the plethora of newer technologies, some utilities are attempting to move fast by deploying them against discrete use cases. But without a view of the desired architecture, that approach leads to duplicative investments and splintered data and integrations that are costly to both capital and O&M. A more successful approach entails deliberately planning a technology architecture to deliver best practices for integrated planning. The Tech Stack Must Support: Across all of the above, generative AI can play an important role in enhancing and accelerating organizational performance, especially when organizations move from pilots to scale. 4. Protect bundle integrity during the handoff to operations A significant portion of the value in integrated planning comes from bundling work intelligently, aligning asset replacement, resilience upgrades, capacity expansion, and DER enablement on the same circuits or stations to capture those aforementioned twofers or three-fers for each project. Without bundle integrity, it’s impossible to capture a large share of the productivity value of integrated investment planning. Regardless of the rationale, unbundling optimized work packages kills integrated planning benefits. Yet, too often we see utilities unbundling work packages. This may be because a specific funding period ran out, or because different parts of the scope progressed at different speeds through the workflow, or because the operations team wanted to fill the schedule with some parts of the scope. Regardless of the rationale, unbundling kills integrated planning benefits. One leading utility drove breakthrough performance on this dimension by redesigning the process and accountabilities for how work scopes are originated and released from planning to operations, including setting the timing for scope release to operations. In return, the utility clarified the processes for governing changes to scope, schedule, or cost, as well as for measuring how effectively bundle integrity is maintained. Embracing a cross-functional planning operating model and connecting it to operations were the most critical success factors. 5. Close the loop with regulators and internal stakeholders Regulators are increasingly asking how specific investments translate into measurable outcomes. In some cases, authorized rate increases have fallen short of requested levels, reflecting skepticism about capital discipline. Integrated planning creates a clear link between expenditures and expected benefits, but that link must be maintained after plan approval and throughout plan execution. For example, the planned evolution of Italy’s remuneration framework would require utilities to measure and report actual outcomes achieved by investments. One utility maintained this link by standing up a process with clear accountabilities for measuring and reporting back on expected benefits to the regulatory team, including investigating gaps between planned and actual outcomes. The utility also formalized accountabilities and processes for adjusting subsequent grid planning assumptions based on the field results. Winning with integrated planning: The new playbook Winning in this new era of T&D investment won’t be determined by how much capital a utility plans to spend but by how confidently it can prove that each incremental dollar is the best available use of customer money, followed by delivering on that plan with discipline in the field. There is no one-size-fits-all solution: The best grid and customer outcomes will depend on highly individualized journeys for each utility. Utilities should review where they stand across the key elements outlined above and assess how to drive the most value ahead of the next planning cycle. There is no one-size-fits-all solution: The best grid and customer outcomes will depend on highly individualized journeys. We can help you tailor an approach that meets your exact needs and ambition.

Transmission and distribution (T&D) investment planning is at an inflection point: A long list of daunting challenges, a surge in capital investment, and higher expectations from regulators and customers now require utilities to take grid planning to an entirely new level.

Among the challenges: Load growth is accelerating, resilience risks and wildfire risks are rising, storms are becoming more severe, and new resources and technologies are reshaping the edge of the grid, all while the system as a whole continues to age.

In response, investor-owned utilities are making massive investments of more than $1 trillion in the US alone over the next five years. That gives rise to perhaps the biggest challenge of all: ensuring that every dollar of that massive investment generates maximum value. This is not simply an aspiration: Utilities must earn the right to deploy capital given current affordability concerns (more on that below) and regulators’ and customers’ demands for increased transparency, including pushes toward outcome-based remuneration, especially in Europe.

We believe utilities must respond to the challenge by adopting integrated grid investment planning, a powerful cross-functional operating model and approach to investment planning.

visualization — Seven Defining Characteristics:

Integrated planning delivers a scenario-based portfolio of work with clearly quantified outcomes and a regulatory narrative that ties investments to results. When implemented well, integrated investment planning can improve capital efficiency by 20% or more, support 5% to 10% operations and maintenance (O&M) savings, improve customer reliability by up to 40%, and drive better employee experience while simultaneously strengthening the case utilities present to regulators.

Utilities often think they’ll achieve the benefits of integrated planning by building or deploying a new tool that optimizes investments differently than before. While newer technology can be helpful, our extensive work with clients confirms that true transformative impact comes from changing the operating model to be cross-functional and fully connected from plan origination through work execution.

We see five gaps and accompanying opportunities that often determine whether integrated planning is delivering maximum value:

1. Refresh the grid strategy before building the grid plan

Historically, grid plans were optimized for asset health, reliability, and load growth within a capital envelope. Today, regulators and customers expect more: resilience to extreme weather and/or wildfires, distributed energy resource (DER) enablement, decarbonization alignment, equitable outcomes, support for and protection from AI-driven growth, and, above all, affordability given the economic pressure many customers are experiencing.

Therefore, rather than building a grid plan that addresses longstanding challenges by deploying an upgraded tool or process, utilities must fully confront the choices and trade-offs inherent in meeting regulators’ and customers’ demands. This approach must address critical questions, including how to balance affordability and necessary investments in reliable service (which entails key questions about capital allocation strategy) as well as what outcomes and key performance indicators will be needed to justify those investments to customers and stakeholders. Then, and only then, is it possible for utilities to move forward with a significantly improved grid planning process.

As an example, in response to recent state legislation, one US utility went through a grid strategy process and redefined its goals for how investments in the distribution grid would support customer reliability, capacity growth, and the integration of DERs. Subsequent investment plans, which were built by looking across the integrated set of needs, have been fully approved by regulators in multiple cases. Given that US regulators only approved 48% of requested electric rate increases in 2025, down from 63% in 2024, this utility’s success highlights one of the major impacts of a true integrated process.

Share of electric rate increases approved by US regulators

2024

2025

2. Use engineers where they add the most value

Utilities are facing a scarcity of skilled labor, and that’s particularly acute when it comes to engineers, who require years of training and are often pulled in many directions as the complexity of the grid increases. In many utilities, experienced engineers spend significant effort upstream defining scopes and manually iterating plan alternatives. Integrated planning can reduce that burden and allow them to shift focus to higher-value activities, such as reviewing exceptions, refining complex cases, and validating solutions.

Leading utilities we work with develop a standardized library of common investment solutions—for example, circuit-hardening packages, reconductoring options, automation configurations, or substation upgrades. They then use AI-driven planning tools to match system needs to these predefined solution sets and assemble optimized bundles that serve as planning guidance for engineers to use in detailed scoping. We’ve found that standardizing investments also yields longer-term benefits through complexity reduction, greater procurement scale, and the accumulation of delivery experience.

3. Adopt a best-in-class technology architecture

Utilities should address architecture before picking tools. It’s an incredibly exciting and overwhelming time to be in T&D planning and operations. Recent innovations in sensors, operating systems, and software across the grid were on full display at DTECH, where we saw several powerful technologies demonstrated, including AI-forward applications.

Given the plethora of newer technologies, some utilities are attempting to move fast by deploying them against discrete use cases. But without a view of the desired architecture, that approach leads to duplicative investments and splintered data and integrations that are costly to both capital and O&M.

A more successful approach entails deliberately planning a technology architecture to deliver best practices for integrated planning.

Across all of the above, generative AI can play an important role in enhancing and accelerating organizational performance, especially when organizations move from pilots to scale.

4. Protect bundle integrity during the handoff to operations

A significant portion of the value in integrated planning comes from bundling work intelligently, aligning asset replacement, resilience upgrades, capacity expansion, and DER enablement on the same circuits or stations to capture those aforementioned twofers or three-fers for each project. Without bundle integrity, it’s impossible to capture a large share of the productivity value of integrated investment planning.

Regardless of the rationale, unbundling optimized work packages kills integrated planning benefits.

Yet, too often we see utilities unbundling work packages. This may be because a specific funding period ran out, or because different parts of the scope progressed at different speeds through the workflow, or because the operations team wanted to fill the schedule with some parts of the scope. Regardless of the rationale, unbundling kills integrated planning benefits.

One leading utility drove breakthrough performance on this dimension by redesigning the process and accountabilities for how work scopes are originated and released from planning to operations, including setting the timing for scope release to operations.

In return, the utility clarified the processes for governing changes to scope, schedule, or cost, as well as for measuring how effectively bundle integrity is maintained. Embracing a cross-functional planning operating model and connecting it to operations were the most critical success factors.

5. Close the loop with regulators and internal stakeholders

Regulators are increasingly asking how specific investments translate into measurable outcomes. In some cases, authorized rate increases have fallen short of requested levels, reflecting skepticism about capital discipline.

Integrated planning creates a clear link between expenditures and expected benefits, but that link must be maintained after plan approval and throughout plan execution. For example, the planned evolution of Italy’s remuneration framework would require utilities to measure and report actual outcomes achieved by investments.

One utility maintained this link by standing up a process with clear accountabilities for measuring and reporting back on expected benefits to the regulatory team, including investigating gaps between planned and actual outcomes. The utility also formalized accountabilities and processes for adjusting subsequent grid planning assumptions based on the field results.

Winning with integrated planning: The new playbook

Winning in this new era of T&D investment won’t be determined by how much capital a utility plans to spend but by how confidently it can prove that each incremental dollar is the best available use of customer money, followed by delivering on that plan with discipline in the field.

There is no one-size-fits-all solution: The best grid and customer outcomes will depend on highly individualized journeys for each utility.

Utilities should review where they stand across the key elements outlined above and assess how to drive the most value ahead of the next planning cycle. There is no one-size-fits-all solution: The best grid and customer outcomes will depend on highly individualized journeys. We can help you tailor an approach that meets your exact needs and ambition.