Electric Power Generation & Distribution
Industry Profile Report
Dive Deep into the industry with a 25+ page industry report (pdf format) including the following chapters
Industry Overview Current Conditions, Industry Structure, How Firms Operate, Industry Trends, Credit Underwriting & Risks, and Industry Forecast.
Call Preparation Call Prep Questions, Industry Terms, and Weblinks.
Financial Insights Working Capital, Capital Financing, Business Valuation, and Financial Benchmarks.
Industry Profile Excerpts
Industry Overview
The 2,227 electric power generation and distribution companies in the US produce and deliver electricity to residential customers, commercial businesses, and industrial operations. The industry consists of publicly-owned utilities, electric co-operatives, investor-owned utilities, and power marketers. Operations are either fully or partially regulated, depending on the State they operate in.
Changes in Environmental Laws and Regulations
Environmental laws and regulations are changing constantly and can have large impacts on electric utilities.
Shift to Natural Gas Generation
Low natural gas prices and restrictions on coal and nuclear plants are causing a shift to natural gas for new generating capacity.
Industry size & Structure
A typical electric power company operates from multiple locations and has revenues of about $253 million per year.
- There are 2,227 firms providing electric power utility services in the US, employing 500,000 workers, and generating annual revenue of $563 billion.
- 58.8% are publicly owned utilities, 25.5% are cooperatives, 5.2% are investor-owned utilities, 9% are power marketers, and 1.6% are either community choice aggregators, behind-the-meter (on-site generation), or federal power agencies.
- Public utilities serve 14.8% of US customers, cooperatives serve 12.9%, investor-owned utilities serve 66%, power marketers serve 4.6%, and behind-the-meter (on-site generation) serves 1.6%.
- 45% of establishments have fewer than 20 employees, and 20% of firms are large with over 100 employees each.
- Large electric power utilities include: Exelon Corp., Southern Co., First Energy, Puerto Rico Electric Power Authority (PREPA), PSEG Long Island, Los Angeles Department of Water and Power (LADWP), Withlacoochee River Electric Cooperative, Cobb Electric Member Corporation and Middle Tennessee EMC.
- Entry into the business as a for-profit enterprise in the distribution business is difficult as most population centers are in franchised territories as designated by the state public utility commission. Entry into the generating business as an independent power producer (IPP) has a lower barrier, requiring only permits and capital for construction and certification by the ISO.
Industry Forecast
Electric Power Generation & Distribution Industry Growth
Recent Developments
Jan 21, 2025 - Rising Electricity Demand Draws Interest of Oil, Gas Firms
- Some oil and gas majors are considering entering the electricity generation market amid the rapid uptick in energy demand by the data centers used to power AI, according to The Wall Street Journal. Chevron and Exxon Mobil are both in conversations with data center operators about providing natural gas-fired power generation with carbon capture. Large oil and gas companies have experience building gas-fired plants to support their various operating activities, including refining, petrochemical production, and natural gas liquefaction. Oil and gas majors may also have more recent plant construction experience than independent power producers, some of which have not built a new plant since the early 2000s. Oil firms can also site plants near their own fuel production sites and power data centers without needing to connect to the grid.
- In mid-January, then-President Biden signed an executive order to help speed up data center development to power AI, as well as the clean-energy electricity generation needed to power the data centers, according to Utility Dive. The order directs the US departments of Defense and Energy to locate lease sites on federal lands for private-sector development of gigawatt-scale data centers and clean electricity generation plants to power them. After the site selection process is complete, the DOD and the DOE will open competitive bidding for leases for private construction, operation, and ownership of AI infrastructure. Project owners will be required to use clean energy for all their electricity needs. The order also calls for expedited project permitting to speed development.
- In December, Commonwealth Fusion Systems (CFS) announced it would build the world’s first commercial fusion energy plant in Chesterfield County in Virginia, according to Construction Dive. CFS was spun out of Massachusetts Institute of Technology in 2018. The firm has received $16.5 million in US Department of Energy grants and has raised more than $2 billion in capital. CFS will receive non-financial cooperation from Dominion Energy Virginia – the current owner of the site for the proposed fusion plant – including technical and development support and leasing rights. There is not yet a timeline for the fusion plant’s completion, but CFS said it would eventually generate enough electricity to power about 150,000 homes.
- In October, the US Department of Energy (DoE) awarded $3.5 billion in funding to support expanded electricity transmission infrastructure and climate resistance grid projects. Nearly $2 billion will go for grid-shoring projects in 42 states and the District of Columbia, including six in Florida for damage caused by hurricanes Helene and Milton and 950 miles of new and higher-capacity transmission lines. The DoE is also providing $1.5 billion in funding to add 1,000 miles of new transmission infrastructure and 7,000 megawatts of new electricity capacity in Louisiana, Maine, Mississippi, New Mexico, Oklahoma, and Texas.
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