Utilities are famously risk-averse, but there is a pressing need for them to innovate in their ­thinking and processes.

It’s often said that necessity is the mother of invention. Yet today, in an environment where there is so much need for innovation – climate change, ageing infrastructure, the smart tech race, and decentralised consumer empowerment – it seems utilities are struggling to conceive truly innovative cultures where “outside the box” thinking is nurtured and swiftly embedded.

Despite some successful innovation projects, recent gatherings of innovation leaders in utilities and technology experts from the supply chain have resoundingly reported that they feel hemmed in – “unable to look to left or right” – when seeking to embrace the disruptive innovations they know are required in the energy and water sectors.

There is also a strong feeling that where innovation is taking place, it is isolated, and there have been calls for broader collaboration, for the “greater good” of the industry as a whole, on the “pre-competitive” foundations of new, smarter energy and water systems.

Furthermore, a disconnect has been observed between technology innovation and the business model innovation that needs to occur in parallel if utilities are to realise the full potential of smart, distributed and dynamic energy and water use.

While it may be possible, even necessary, for the bulk of disruptive technology innovation to take place further down the supply chain in agile, IP-hungry manufacturing and engineering firms, only utilities themselves can execute the required business model innovation. Only utilities can reorientate their organisations to thrive off the new value streams and revenue models that emerging technology will enable.

There are many – often interdependent – reasons why barriers to innovation exist, not least of which are risk aversion and regulation.

These barriers are not insurmountable, however. It is essential, for the future resilience of the UK’s energy and water systems, not to mention the survival of the organisations, that utilities embrace disruptive innovation with enthusiasm and purpose.

This report seeks to understand the barriers (both real and perceived) to innovation for utilities and identify ways in which they can be dismantled or overcome.

Read the report as it appeared in Utility Week’s print magazine here: http://read.utilityweek.co.uk/i/512337-innovation-report