5 Top Trends in the Energy & Power Sector (2025 Guide)

It’s no secret that the energy and power sector is undergoing profound technological changes—even a revolution. Like any revolution, the marriage of AI and energy presents both opportunities and challenges.

On the one hand, it’s becoming clear that smarter solutions are necessary to meet clean energy goals and rising production demands. On the other hand, limitations of legacy infrastructure, data fragmentation, long-term ROI uncertainty, and skills gaps are among the challenges that energy companies need to take seriously.

In this article, we’ll walk through some top trends in the energy and power sector, specifically focusing on the recent advancements AI is providing.

The Energy-AI Nexus

In their benchmark report on the intersection of AI and Energy, International Energy Agency (IEA) used the term “Energy-AI Nexus” to describe the phenomenon that occurs when “Digital and energy infrastructure often reinforce one another.”

There are a number of reasons for the intertwining of these two sectors, but top of the list is the sheer amount of data needed to achieve top energy efficiency goals. Few energy companies are hurting for data—smart meters and IoT sensors generate billions of data points every day. But analyzing data, uncovering patterns, and optimizing decisions requires more advanced methods than traditional data science allows.

Faster and more robust data analysis—including better handling of complexity, finding non-linear patterns, and making real-time adaptive decisions—can improve energy efficiency and sustainability. Here are the types of analytics that AI is already improving:

• Predictive maintenance can now better detect potential faults before equipment fails, preventing costly unplanned outages
• Predictive analytics can more accurately forecast electricity demand and adjust grid resources accordingly
• Analysis and optimization of oil refining processes through AI can cut energy use and emissions per barrel produced
• Rapid analysis and simulation with AI can quicken sustainable energy R&D, enabling companies to bring breakthrough clean technologies to market faster

For these reasons (and more), the U.S. Department of Energy, which states that “AI is an essential tool to navigate the complexities of […] accelerating innovation and improving efficiency and reliability.” In fact, some studies suggest that AI-driven efficiency measures and smart grid technologies could create $1.3 trillion in value by 2030 and reduce GHG emissions by 5-10%.

Top 5 trends in the energy and power sector

There’s hardly an area of the U.S. and global energy sectors that hasn’t yet been touched by AI. Although many of the trends listed below have been in play for a while now, the surge of AI use has accelerated them significantly.

1. Surging energy demands

U.S. energy demands are expanding at shocking rates. According to recent forecasts from the U.S. Energy Information Administration, annual electricity consumption is expected to exceed 4,200 terawatt-hours (TWh) in 2025, up from a record high 4,097 in 2024.

The primary cause of this increase is AI-driven, although cryptocurrency’s surge in popularity also requires an increase in energy production. Some projections have data center operation accounting for as much as 12% of total U.S. energy demand.

Although AI is a major cause of surging energy demands, it also provides a potential solution. Smart grid optimization, improved weather forecasting for more consistent renewable energy creation, Virtual Power Plants (VPPs) and other advancements could potentially balance out the heightened consumption that the growth of AI usage demands.

2. Shifting energy mixes

At the same time as utilization is increasing, the U.S. energy mix is changing, with clean sources like wind and solar growing quickly and reshaping energy production portfolios.

As of now, solar power provides roughly 7% of U.S. electricity. On top of that, battery storage nearly doubled in 2024, allowing growing stability even as renewables expand. On the flip side, coal production has dropped from 37% in 1950 to 9% 2023, which is also impacting energy mixes.

A major reason for this transformation is the dual demand on energy executives: ramping up supply (partly due to AI demands) while doing so in a cleaner way. Meeting these mandates requires a diverse array of energy sources, rather than going all in on one source.

3. Grid modernization

As a result of distributed energy resources, energy and power companies are investing significantly in modernizing their electric grids. According to the National Council of State Legislatures, just maintaining the grid’s reliability in the face of increasing demand will require $2 trillion of investment by 2030.

Some of the specific initiatives covered under the umbrella of grid modernization include:

• Integrating decentralized power sources, like solar panels, wind turbines, battery storage, etc.
• Deploying advanced metering infrastructure (AMI) to enable real-time monitoring
• Implementing dynamic line rating systems
• Strengthening and burying power lines to protect against extreme weather and reduce the risk of outages
• Building localized grids that can operate independently during outages
• Deploying and developing battery and other energy storage systems to support load leveling, peak shaving, and provide more consistent sources of backup power
• Implementing demand response programs to automate load control and reduce over-consumption

4. Automated energy administration

AI-powered automation tools don’t just help with front-line energy production, but with back-office administration as well. Process optimization, predictive maintenance schedules, drone-based inspections, and even finance, operations, and communications all can be automated and enhanced with AI.

5. Cybersecurity and resiliency

As energy companies store increasingly large amounts of data and build automated energy systems, the threat of a data breach or cybersecurity attack increases. Like it or not, energy companies are now digital companies, which opens the door for cyber threats. In fact, 28% of midmarket energy executives have experienced a data breach in the last year.

Additionally, companies with more mature cyber defenses are in a better position to build trust with their customers and regulators. By securing their supply chains, monitoring OT and IT, and crafting emergency response plans, energy executives can build more resilience, both preventing and recovering from attacks when, not if, they happen.

How can leaders stay adaptive and innovative in this environment?

In light of the transformations above, what can energy and power sector executives do to remain ahead of the curve? Here are several strategic recommendations to help leadership teams adapt, innovate, and build resilience in this rapidly evolving landscape:

• Foster a culture of continuous learning and innovation—allowing some room for failures to use as learning opportunities
• Invest in your digital foundation (data, tools, and governance), as legacy IT infrastructures may struggle to keep up with ongoing innovations
• Prioritize risk management and cybersecurity, especially as you deploy new digital tools and AI innovations
• Empower, upskill, and reskill your workforce, whether through in-house training, workshops, sponsored courses, or targeted hiring (Note: This should apply to leadership, not just front-line employees)
• Leverage strategic partnerships and talent networks, especially in areas where it’s time- and labor-intensive to build out your own capabilities

This last area is where AEG comes in. We’re an IT and engineering staffing and recruiting firm with deep experience in the energy sector. Whether you’re looking for skilled data analysts, AI engineers, cybersecurity experts, or project managers, we’ve spent decades building relationships with the talent you need.

But more than that: AEG is committed to being a true partner as you navigate the shifting trends of AI and overall volatility in the energy sector. We don’t just serve up talent—we align our hiring practices with your strategic business goals.

Want to learn more? Contact our team and we’ll figure out the best way to help you.