Investing in R&D and Innovation
Tom Flaherty is a Senior Advisor to companies in the global power and utilities industry for PwC Strategy&. Assistance provided by: Tom Haddon, a Manager in the strategic market analysis group at PwC. Amy Zhao, an Associate in the power and utilities practice of Strategy&.
The utilities sector is at the front-end of a dramatic energy transition across markets and customers that will radically affect future strategies, business models, and customer interactions. Where and how companies compete will be vastly different as new technologies become more economic, with higher performance and versatility.
Utilities are focused on enhancing their market positioning and readiness to meet these transition challenges, including decarbonizing their generation mix, modernizing and improving grid resilience, redefining their customer value propositions, and elevating the role of technology in enabling energy delivery and consumption.
In our recent Power Strategies Report, we assessed how the world's largest utilities — the Global Top 40 (GT40) — were leveraging new strategies to meet future market disruption. Core to this positioning was how research and development (R&D) and innovation would provide critical underpinnings to the GT40 to fortify their future competitiveness and forge new growth options.
While R&D and innovation are clearly viewed as means to access new markets and extend utility capabilities, this peer group exhibits uneven strategic and financial commitment to achieving these outcomes.