The State of Observability for Energy and Utilities study, released by New Relic, the all-in-one observability platform for every engineer, provides information and analysis on the uptake and economic benefits of observability for the energy and utilities sector.
According to a recent study, which is greater than any other industry, 66% of respondents stated that their company gains at least $1 million annually in value from its observability investment.
This underscores the significance of integrating observability. Energy and utility companies earn about three times the median annual return on investment (ROI) based on estimates of yearly spend and annual value obtained. According to the report’s results, 50% of IT decision-makers in the energy and utilities industry believe that observability is essential to their ability to build a technological strategy.
The State of Observability for Energy and Utilities study, released by New Relic, the all-in-one observability platform for every engineer, provides information and analysis on the uptake and economic benefits of observability for the energy and utilities sector.
The results of the study demonstrate that companies in the energy and utility sectors are making investments in observability, namely in AIOps and mobile monitoring, in order to get real-time insights into their infrastructure and lower the frequency and cost of outages.
“Nobody wants their lights to go out without warning. This means that uptime and reliability is a top priority for energy and utilities providers,” said New Relic Chief Design and Strategy Officer Peter Pezaris. “Implementing and maturing their observability practice offers a path forward for energy and utilities providers, creating greater visibility and faster time to resolution.”
AI adoption is on the rise
Organizations may benefit from the potent combination of observability and AI in order to better interpret telemetry data and overcome the difficulties posed by ever growing data sets.
Among respondents from energy and utility companies, 56% said they had already implemented AIOps capabilities, such as anomaly detection, incident intelligence, and root cause analysis, and 89% said they planned to do so by the middle of 2026.
AIOps can help utilities and energy companies by facilitating quicker reaction times and improving operational efficiency. It facilitates decision-makers in discovering lessons about system performance and assists teams in obtaining actionable insights, hence enhancing problem identification and resolution.
Compared to all other businesses, energy and utility companies had the highest rate of outages: 40% of them saw high-business-impact outages at least once a week, as opposed to 32% on average.
For energy/utilities companies, the median yearly downtime was 37 hours, which is 61% more than the industry average of 23 hours and by far the greatest of any industry. Energy and utility companies have a heavy financial burden from this outage; the median yearly outage cost is $34.31 million, the largest amount among all other businesses.
The energy and utilities organizations that achieved full-stack observability saw substantial improvements to mean time to resolution (MTTR), which can support the reduction of outage costs.
Some 87% of those with full-stack observability said MTTR improved to some degree since adopting observability, compared to 76% of respondents without full-stack observability.
Additionally, while the proportion of energy/utilities respondents using a single tool has increased since last year, growing from 2% to 3%, the average number of tools has remained unchanged at six tools year-over-year. This indicates that providers are spending significant time and money tool-hopping to better understand the different aspects of their business and to resolve issues that lead to costly outages and poor customer experiences.
“Observability platforms are proving to be crucial for energy and utility providers across India. As uptime and reliability become paramount to avoiding service disruptions, implementing and maturing observability practices offers a clear path forward. By gaining greater visibility into their IT infrastructure, energy and utilities providers can achieve faster time to resolution for issues, ensuring the lights stay on and operations run smoothly,” Peter Marelas, Chief Architect, APJ, New Relic.
Security is the most widely deployed capability
Cyberattacks often target energy and utility suppliers, highlighting the significance of effective network, security, and infrastructure monitoring. For energy and utility companies, security monitoring was the most often used capacity (68%), and almost all respondents (99%) anticipated having implemented security monitoring by the middle of 2026.
Furthermore, a greater emphasis on security, governance, risk, and compliance was the top technological strategy or trend (44%), which was boosting the demand among energy/utilities firms.
Read The Report, Here
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