How can electric utilities drive their investments in digital innovation?

While the literature on the innovation process is abundant for some contexts, such as the development of new manufactured products, little has been published on the specific challenges facing electric utilities in driving digital innovation. The objective of this study was first to identify how electric utilities currently steer digital innovation, which objectives they pursue, and which challenges they face, and then to provide recommendations on how they could improve their resource allocation in this area. We have used an online survey filled by 40+ executives from European power companies, and interviews. Improving efficiency and better serving customers came up as the main objectives for digital innovation. Internal resistance to change was the largest source of uncertainty. Surprisingly, current decision methods and risk management practices did not reflect the objectives and challenges that participants reported. As an alternative, we introduced a tractable comparative method. A feasibility workshop on the AI innovation portfolio of a representative company validated this approach and an initial set of criteria for selection.