Key takeaways
- US utilities come in three main ownership types: investor-owned, publicly owned and cooperative. Each buys differently.
- The EIA counted 168 investor-owned electric utilities serving 72% of customers in 2017, alongside 1,958 publicly owned and 812 cooperative utilities.
- Federally funded projects can bring Build America, Buy America (BABA) requirements; vendors to bulk-power utilities face NERC CIP-013 supply chain security expectations.
- Utility sales cycles are long. Start with research and pilots, and build references in one segment before expanding.
This guide is general information, not legal advice. Confirm the requirements for your products and projects with qualified advisers.
The US utility landscape
There is no single US utility market. There are thousands of utilities, and who owns them shapes how they buy.
| Electric utility type | Number (2017) | Notes |
|---|---|---|
| Investor-owned | 168 | Served 72% of US electricity customers; average of about 654,600 customers each |
| Publicly owned (municipal, public power districts, state and federal) | 1,958 | Average of about 12,100 customers each; governed by city councils or public boards |
| Cooperatives | 812 | Member-owned; average of about 24,500 customers each, often in rural areas |
Source: U.S. Energy Information Administration, 2017 data.
Water and wastewater utilities are far more numerous, and many are run by cities, counties or special districts. Gas distribution includes both investor-owned companies and publicly owned systems. Our utilities market page covers each segment.
How each type of utility buys
- Investor-owned utilities buy through corporate procurement and supplier qualification programs. Large investments are reviewed by state utility regulators, often through rate cases and integrated resource plans, so the regulatory calendar matters. Track them with our rate case and IRP tracker.
- Publicly owned utilities follow public procurement rules: formal bids above set thresholds, board or council approval and public meeting records. Their plans and budgets are public, which makes them easier to research.
- Cooperatives are governed by member-elected boards. Many work closely with their generation and transmission cooperatives and peer co-ops, so references travel fast.
Across all three, engineers and operations staff shape requirements long before a purchase, and many utilities prefer to pilot new technology before buying at scale. Our utility buyer's guide explains the buying process in detail.
Compliance and standards to prepare for
Build America, Buy America (BABA)
When a utility project is funded in whole or part with federal money, BABA may apply to the iron, steel, manufactured products and construction materials used in it. Manufactured products must be manufactured in the US with more than 55% of component cost from US components, and iron and steel must be made in the US through every manufacturing process. Waivers exist for public interest, non-availability and cost increases above 25%. Watch federal programs flowing to utilities with our utility funding tracker.
NERC CIP-013 supply chain security
Utilities that operate the bulk electric system must manage cyber security risk in their supply chain under NERC CIP-013. Their plans cover vendor risk and procurement controls, software integrity and authenticity, and vendor remote access. Suppliers of software, controls and connected equipment should expect detailed security questionnaires and contract terms.
US standards and certifications
Expect utilities to require US standards and certifications for your category, and to ask about local service, spare parts and support in US time zones.
How international suppliers enter the US utility market
- Research before you sell. Learn how your target utilities buy, which vendors they use and where their pain points are. Kamstrup, the European smart water meter maker, worked with KSG to interview more than 1,000 water agencies across the US and Canada before scaling.
- Choose a first segment. Municipal utilities and co-ops are often more accessible for new entrants than the largest investor-owned utilities.
- Reach engineers, not just procurement. Technical discovery conversations with engineers and operations leads uncover requirements and timing. For Siemens, KSG contacted 2,500+ utilities and produced 70 qualified meetings this way.
- Offer pilots. A low-risk pilot with one utility can become your most valuable US reference.
- Line up a way to buy. Direct contracts, US distributors or representatives, or cooperative purchasing contracts that public utilities can use.
- Follow the money. Rate cases, capital plans and federal funding programs signal which utilities are about to invest.
How KSG helps
KSG has spent years selling to utilities for clients, including European and international suppliers. We run market research and outbound programs that reach utility engineers and decision-makers and book qualified meetings. See our US market entry service.
Sources: U.S. Energy Information Administration, utility ownership types; Sidley on OMB's final BABA guidance; TRC on NERC CIP-013 supply chain risk management.