One of the most favorable remarks people have expressed regarding the electrical grid was … silence. The grid operates most effectively when it becomes inconspicuous. 

That understated position has shifted recently as wildfires in California and cold snaps in Texas have increased public awareness of the electrical grid. However, it was in 2025 that the electrical grid — along with concerns about demand, supply, pricing, and the pressure on natural resources — entered the limelight. A fresh wave of startups has appeared with a software-as-a-solution approach.

Electricity prices have surged by 13% in the U.S. this year due to an AI surge that has infiltrated unexpected areas, such as modifying supersonic jet engines for data center use and exploring methods to transmit solar energy from space.

Additionally, this growth trajectory is not anticipated to diminish; the energy consumption of data centers is expected to nearly triple over the next ten years. This projection has sparked consumer dissatisfaction over pricing and attracted the attention of environmental organizations that are demanding a nationwide halt on new initiatives. Utilities, traditionally working in the background, are now racing to enhance the grid and construct new power facilities capable of handling the demand — with the anxiety of a potential AI bubble burst always present.

This mixture of demand and apprehension might provide an advantage to software startups in the near future.

For instance, startups such as Gridcare and Yottar contend that there is already unused capacity on the grid and that software can assist in identifying it.

Gridcare has compiled information on transmission and distribution lines, fiber-optic networks, extreme weather patterns, and even community opinions to fine-tune the search for new sites and persuade utilities that the grid can accommodate more. The company claims to have already identified several neglected sites. Yottar locates areas with established capacity that coincides with the requirements of medium-sized users, facilitating their swift connection amidst the data center expansion.

Many other startups are utilizing software to connect extensive fleets of batteries distributed across the grid. These companies can transform these fleets into virtual power stations, supplying electricity to the grid during peak demand.

Base Power, for example, is establishing one in Texas by renting batteries to residents at relatively low rates. Homeowners can utilize the batteries for backup energy during outages, while Base can leverage them to avert outages by marketing the consolidated capacity to the grid. Terralayr is pursuing a similar path, although it does not retail batteries. Instead, Terralayr employs software to aggregate distributed storage resources already present on the German grid.

Other startups, such as Texture, Uplight, and Camus, are creating software solutions to integrate and synchronize diverse energy sources like wind, solar, and batteries. The aim is to ensure that by managing various resources, they will operate less idly and provide more support to the grid.

There’s also some optimism that software can aid in modernizing certain outdated aspects of the grid.

Nvidia, for instance, has teamed up with EPRI, an R&D organization in the power sector, to create industry-specific models in hopes of enhancing efficiency and resilience. Meanwhile, Google is collaborating with the grid operator PJM to leverage AI to navigate its backlog of connection applications from new electricity sources.

These transformations won’t occur instantaneously, but 2026 may mark the beginning of their implementation.

Utilities are often slow to embrace new technologies due to reliability concerns. They are also slow to invest in new infrastructure because of the expenses and longevity involved. Ratepayers and regulators have sometimes resisted when such projects threaten affordability.

However, software is more affordable, and if it can pass the reliability tests, the firms offering it stand a good chance of making significant headway.

And this could benefit more than just the startups promoting software. Ultimately, the grid requires some upgrading and expansion. Given the plethora of planned data centers and the electrification of vast areas of the economy, such as transportation and heating, additional power will be necessary. It would be unwise to overlook the potential of software in these scenarios. It’s cost-effective, adaptable, and quick to implement.