The 5 Costliest Risks Facing the Utility Industry

The 5 Costliest Risks Facing the Utility Industry

The U.S. utility industry has a market capitalization of over $1.5 trillion and employs over 500,000 workers. For utility companies to maintain long-term business success and protect their workforces and operations, it’s important to remain aware and responsive to industry-wide threats and concerns. Here, we discuss the five costliest safety considerations for utility companies: worker injury; regulation violations; workforce mental health and substance abuse; digitalization and IoT; and talent succession.

Since the utility industry has a large number of lone workers, we are also offering a free downloadable guide, Lone Worker Safety: Risks, Considerations, and Solutions.

1. Worker Injury

According to the National Safety Council (NSC), utility ranks in the top ten most dangerous industries based on death rates and nonfatal injury and illness. Additionally, a survey by reports that utility workers are 54% more likely than those in other industries to have daily worries about getting injured because of their job.

Between 2003 and 2017, the industry had the second-highest rate of fatal electrical injuries. In 2018, there were 10.6 recordable cases of nonfatal occupational injuries and illnesses per 100 full-time utility workers in the U.S.

Worker injury leads to both direct and indirect costs to utility employers. Direct costs include workers’ compensation payments, legal fees, and medical expenses. Indirect costs include lost productivity, finding and training replacement employees, accident investigation, implementation of corrective measures, and repairing damaged equipment and property. 

2. Regulation Violations

Depending on the nature of the violation, OSHA fines can cost utility companies tens of thousands to hundreds of thousands of dollars per violation — and these can add up. For example, Atlantic Coast Utilities LLC/Advanced Utilities is currently facing over $1.3 million in penalties for 28 violations.

In addition to indicating unsafe working conditions, compelling further investigation, and potentially causing worker injury, these violations must be reported to prospective clients, which can cost millions of dollars in lost business opportunities. OSHA citations and violations can also lead to increased insurance premiums, negative press, business disruption, and more.

Common OSHA violations include failure to communicate hazards, improper fall protection and/or scaffolding, inadequate health and safety protocols, and lack of appropriate employee protection from dangerous substances. These violations can often be prevented by deploying an effective communication system, conducting regular employee training, and incorporating risk assessment results and employee feedback into workplace policies and training.

3. Workforce Mental Health & Substance Abuse

National Surveys on Drug Use and Health (NSDUH) data indicated that past-month heavy alcohol use was 10.3% in the utility industry. Additionally, American Addiction Centers reported that the utility industry ranked the fifth-highest in terms of past-year substance use disorders at 11.5%. Substance abuse in the utility industry can lead to workplace injury, professional oversights, and diminished organizational success.

Substance abuse often stems from mental health concerns, so it’s important to provide organizational resources to support workforce mental health and to remain aware of and responsive to job-related mental health risks. For example, occupational electromagnetic field exposure, such as that in electricity utility, is associated with increased suicide.

4. Digitalization and IoT

A market report estimates that the Internet of Things (IoT) — or wireless data connection systems — in the utility sector will be worth $53.8B by 2024. Additionally, by 2023, the “smart home” (or “home automation”) market is estimated to reach $138B. As a result, utility companies must adapt and become agile and operationally efficient. This includes improving project automation and digitization of routine processes.

However, digitization brings an additional risk: cybersecurity breaches. As your organization increases technological offerings, it’s important to implement digital defense measures and train your workforce on best practices for internet safety.

5. Talent Succession

Due to the Baby Boomer generation and updated age discrimination laws, the median age of workers is rising in the United States. This has significantly affected the utility industry: estimates indicate that 50% of the utility industry’s workforce will retire in the next five to ten years.

​​An aging workforce presents several problems. Older workers have more trouble adapting to increasing automation, so a high population of aging workers can hinder utility companies from embracing technological advancements. Older workers also have a higher likelihood of getting injured and tend to miss more days of work while recovering. 

In the coming years, utility companies will have to contend with significant changes in staffing and will have to devote resources to hiring and training many new workers.

Addressing Utilities Industry Risks

Key risks and safety concerns can differ based on an organization’s size, structure, and operations, but the five considerations listed above should be top of mind for all utility companies. In addition to increasing employee training and updating health and safety policies, one way to improve risk awareness and communications is by deploying a mobile risk management platform such as Vector LiveSafe

With LiveSafe, organizations can send customized mass notifications, upload customized company and safety resources, and receive worker-submitted tips. These features can help power and utility companies better understand their organization's risk landscape and support worker safety.

Additionally, as organizations across the nation continue to face or recover from the COVID-19 pandemic, preventing workplace illness and protecting lone workers is an increasingly important consideration.

For workplace health tips and illness statistics, consider downloading our customizable workplace health infographic. To learn more about protecting your lone workers, we have also prepared a free guide, Lone Worker Safety: Risks, Considerations & Solutions.


Alexandra Brunjes has a B.S. in Neurobiology from Georgetown University in Washington, D.C. with minors in Creative Writing and French. She is a published journalist and experienced health and science writer. Her expertise includes risk intelligence, healthcare and neuroscience, and technology.

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