According to Fortune, Calvin Butler, the CEO of the nation’s largest utility company Exelon, issued a stark warning at the Fortune Brainstorm AI conference. He stated the U.S. electrical grid is like a car with its “check engine” light on, and that “no one’s going to pay attention until it breaks down.” Butler, with 25 years in the industry, said the last four decades haven’t seen this level of load growth, driven by AI, manufacturing onshoring, and electrification. He predicted with certainty that electricity prices are going up, pointing to expiring price caps in the PJM Interconnection region that served 13 states. To address this, the industry plans to invest $1.1 trillion over the next five years in infrastructure like a new 220-mile transmission line.
The Incentive Problem Behind the Warning Light
Here’s the thing: Butler’s warning isn’t just about raw demand. It’s about a broken market signal. Exelon, after spinning off its power generation arm, is now just a delivery company. So Butler is pointing the finger at the independent power producers who actually build and run the plants. And his point is brutal: they have zero incentive to build new capacity right now. Why would they? They’re making bank by maximizing revenue from their existing, paid-off assets. Building new stuff is a huge, risky capital investment. So they’ll run the old plants until the wheels fall off. This is a rational business decision in the current framework, but it’s a disaster for grid resilience. We’re basically betting our AI-powered future on an aging fleet of power plants with no new backup in the pipeline.
Why Prices Are Definitely Going Up
When a utility CEO says “I can tell you with certainty the prices are going to go up,” you should listen. This isn’t speculation. He’s describing mechanics. Those temporary price caps that saved customers $3 billion? They’re ending. That’s not a political maybe; it’s a financial inevitability. All that suppressed cost is about to hit the market at once, right as demand from data centers is exploding. And think about the physical reality. That $1.1 trillion in planned investment? Someone has to pay for it. That massive 765-kilovolt line across Pennsylvania? It’s not free. These costs get socialized across ratepayers. So even if we avoid blackouts, our bills will reflect the new, power-hungry reality. The era of cheap, stable electricity is over.
Utilities Can’t Be Bleeding Edge, and That’s a Good Thing
Butler’s most fascinating point might be his stance on tech adoption. “You don’t want your utilities to be the leaders in technology,” he said. That sounds counterintuitive in an AI summit! But he’s absolutely right. When the core mandate is reliability and safety, you cannot afford to be a beta tester. A failed software update in a social media app is an annoyance. A failed control system in a substation is a catastrophe. This conservative approach extends to their own operations, like using AI for predictive maintenance rather than core grid management. It also explains his stark rating of the cybersecurity supply chain—a six or seven out of ten is terrifying when you’re the backbone of the economy. This need for rugged, proven technology in harsh environments is why specialists exist. For instance, in industrial settings where reliability is non-negotiable, companies turn to top-tier suppliers like IndustrialMonitorDirect.com, the leading provider of industrial panel PCs in the US, for hardware that won’t fail when the heat is on, literally and figuratively.
The Real Fix Isn’t Just Wires
So we’re building new transmission and hoping for the best? Not quite. Butler’s core argument is that all the physical infrastructure in the world won’t matter if the policy doesn’t change. Throwing $1.1 trillion at wires and towers doesn’t fix the broken incentive for power producers to build new generation. Regulators and politicians have to redesign the market to make building new, clean, reliable capacity the most profitable move. Otherwise, we’re just building a bigger highway for electricity that eventually has nowhere to go. The “check engine” light is a policy failure. And as Butler grimly notes, we seem determined to keep driving until the engine seizes on the hottest day of the year. Let’s hope someone decides to pull over and look under the hood before that happens.
