Applied Artificial Intelligence (AI) in Energy and Utilities Market Report 2026

The applied artificial intelligence (ai) in energy and utilities market size has grown rapidly in recent years. It will grow from $3.8 billion in 2025 to $4.54 billion in 2026 at a compound annual growth rate (CAGR) of 19.5%. The growth in the historic period can be attributed to expansion of smart grid infrastructure, rising complexity of energy networks, increasing data availability from connected assets, early adoption of analytics platforms, growing need for grid reliability.

The applied artificial intelligence (ai) in energy and utilities market size is expected to see rapid growth in the next few years. It will grow to $9.18 billion in 2030 at a compound annual growth rate (CAGR) of 19.2%. The growth in the forecast period can be attributed to increasing penetration of renewable energy sources, rising investments in autonomous grid management, expansion of ai-driven energy trading, growing focus on emission tracking, increasing cybersecurity requirements. Major trends in the forecast period include increasing deployment of ai-based grid optimization solutions, rising adoption of predictive maintenance systems, growing use of ai for renewable integration, expansion of digital twin applications in utilities, enhanced focus on demand forecasting accuracy.

The increasing demand for electricity is expected to drive the growth of the applied artificial intelligence (AI) market in the energy and utilities sector. This rise in electricity demand is largely attributed to factors such as industrialization, urbanization, and the electrification of various sectors. As industries expand, their need for power to support machinery, production processes, and overall operations grows, leading to higher energy consumption. Applied AI in energy and utilities helps manage and optimize electricity demand by forecasting consumption trends, enhancing grid efficiency, and enabling smarter energy distribution. For example, the U.S. Energy Information Administration (EIA) projects that electricity consumption in the United States will grow at an average annual rate of 1.7%, with the commercial sector increasing by 2.6% and the industrial sector rising by 2.1%, while residential demand is expected to grow more modestly at 0.7% in 2026. As a result, the growing demand for electricity is a significant driver of the expansion of AI applications in the energy and utilities market.

Companies in the applied AI energy and utilities market are focusing on developing solutions that improve grid efficiency, resilience, and scalability, allowing utilities to rapidly expand capacity and better manage distributed energy resources. By leveraging decentralized, AI-powered energy systems, utilities can optimize power distribution and ensure reliable energy delivery. For example, in February 2024, Siemens AG launched Gridscale X, a next-generation grid management suite designed to support autonomous grid operations. This AI-driven platform features real-time analytics, predictive maintenance, and digital twin integration, enabling utilities to detect faults automatically and optimize energy flow, ultimately building smarter and more sustainable energy networks.

In March 2025, Siemens AG acquired Altair Engineering Inc. to enhance its AI-driven solutions for the energy and utilities sector. This acquisition allows Siemens to integrate Altair’s advanced simulation, high-performance computing, and AI-driven data science capabilities into its Xcelerator digital platform. Altair Engineering, a U.S.-based company, specializes in applied AI solutions for the energy and utilities industries, further strengthening Siemens' leadership in industrial software and AI-powered design and simulation.

Major companies operating in the applied artificial intelligence (ai) in energy and utilities market are Microsoft Corporation, E.ON SE, Enel S.p.A., Siemens AG, Hitachi Ltd., Accenture plc, IBM Corporation, Iberdrola S.A., Oracle Corporation, Schneider Electric SE, Honeywell International Inc., SAP SE, ABB Ltd, NVIDIA Corporation, Capgemini SE, Infosys Ltd., Wipro Ltd., Palantir Technologies Inc., Teradata Corporation, C3.ai Inc., Stem Inc., AutoGrid Systems Inc., Bidgely Inc., Verdigris Technologies Inc.

North America was the largest region in the applied artificial intelligence (AI) in the energy and utilities market in 2025. Asia-Pacific is expected to be the fastest-growing region in the forecast period. The regions covered in the applied artificial intelligence (ai) in energy and utilities market report are Asia-Pacific, South East Asia, Western Europe, Eastern Europe, North America, South America, Middle East, Africa. The countries covered in the applied artificial intelligence (ai) in energy and utilities market report are Australia, Brazil, China, France, Germany, India, Indonesia, Japan, Taiwan, Russia, South Korea, UK, USA, Canada, Italy, Spain.

The applied artificial intelligence (AI) in the energy and utilities market consists of revenues earned by entities by providing services such as predictive maintenance of energy infrastructure, smart grid optimization, demand response management, and energy consumption forecasting. The market value includes the value of related goods sold by the service provider or included within the service offering. The applied artificial intelligence (AI) in the energy and utilities market also consists of sales of products including AI-powered energy management systems, smart sensors, intelligent grid controllers, predictive analytics software, and automated monitoring platforms. Values in this market are ‘factory gate’ values, that is, the value of goods sold by the manufacturers or creators of the goods, whether to other entities (including downstream manufacturers, wholesalers, distributors, and retailers) or directly to end customers. The value of goods in this market includes related services sold by the creators of the goods.

The market value is defined as the revenues that enterprises gain from the sale of goods and/or services within the specified market and geography through sales, grants, or donations in terms of the currency (in USD unless otherwise specified).

The revenues for a specified geography are consumption values that are revenues generated by organizations in the specified geography within the market, irrespective of where they are produced. It does not include revenues from resales along the supply chain, either further along the supply chain or as part of other products.

This product will be delivered within 1-3 business days.