Capex planning is a strategic challenge for many power and utility companies. Faced with mounting growth projections while paying down the “infrastructure debt” – upgrading aging grid systems, and advancing policy goals such as decarbonization, decision-makers are often frozen by indecision. Rather than decide and act under uncertainty, too many cling to the utopian hope that the fog will clear once the uncertainty is gone, defaulting to the status quo – doing nothing. But uncertainty may not go away and those who embrace it and are willing to make forward-looking bets thrive. Uncertainty is reflected in understanding the the feasibility of the projects in the pipeline, capital allocation, investment in workforce and talent building, and project delivery.
Our book ‘Recreating the Power Grid: Navigating Technological and Organizational Changes’ provides a systematic approach to making strategic decisions amid uncertainty. Clarifying the ambition, setting the compass heading, and investing in preparedness are core components of a resilient strategy. Power and utility leaders must build this decision-making muscle.
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