Wireless transformed telecom.
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There was a time when no one could imagine a telephone that wasn’t tethered to the wall. Then wireless arrived, and within a decade telecom turned upside down. Electricity is fast approaching its own paradigm shift. Residential rates are climbing, up nearly 5% last year, and data center load is growing faster than utilities can plan for. Telecom tells the story of how a massive, legacy industry overcame 100-year-old hurdles it constructed when the world and technology looked very different.
The 911 Emergency
When consumer wireless phones first arrived in the 1990s, emergency 911 service posed a seemingly insurmountable hurdle to widespread adoption. Telecom ultimately cleared the hurdle by migrating from hardware to software, adopting new business models and adapting the regulatory rules that had governed an industry built on landlines.
The electricity grid faces its own version of the 911 hurdle. For a century the grid has been built so that generation follows load, firing up power plants to match demand wherever and whenever it shows up. The fix for today’s soaring demand flips that logic, using software and smart devices to shape and shift demand so it follows the generation already on the system. Making that shift takes the same three levers: new technology, new business models and revised regulation. Whether the grid can now do what telecom did matters because it shapes both the reliability of the grid and the price of using it going forward.
Over A Century Of Two Foundational Monopolies
Telecom and electricity grew up together as regulated monopolies, telecom starting in New Haven, Connecticut, in January 1878, the grid four years later at Thomas Edison’s Pearl Street Station in lower Manhattan, the first commercial power plant in the United States. Both were built to serve everyone equitably and keep residential rates low, and both rewarded one thing above all: physical infrastructure.
Wireless Wasn’t A Foregone Conclusion
When wireless became technically feasible, it promised consumers the freedom to make a call from anywhere. Regulators saw it as an unacceptable reliability risk for 911 service, which ran on fixed, locatable landlines. A network with dropped calls and unknown caller locations looked fundamentally unfit to carry emergency traffic, a seemingly permanent ceiling on adoption.
We know how the story ends. Carriers built out enhanced 911 location systems, regulators approved them and the roadblock dissolved. The transformation went beyond technology to how companies made money, what consumers paid and the regulatory rules that governed the industry. Within a generation, wireless went from novel to the default normal.
The Grid’s Infrastructure Anchor
The electricity grid has its own version of the non-negotiable landline: the generation-follows-load model. The premise is that reliability requires large amounts of dispatchable generation, ready to cover every possible peak, no matter how rare. Dispatchable means power plants like natural gas, coal, nuclear and hydro that can be turned on whenever demand spikes.
As in telecom, regulation and business models reward capital investment in infrastructure, in this case the power plants, transmission lines and distribution equipment that deliver electricity where it is needed.
The Renewable Challenge
Solar and wind power
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Solar and wind have challenged the status quo for two decades, making significant headway. They are now the cheapest sources of new electricity and make up nearly all of the new capacity being added to the grid each year. Neither is dispatchable, so both need batteries or demand that can shift to match when power is available.
Managing demand to follow generation and shave peaks provides reliability to the system. But the same 911 skepticism that once plagued telecom persists in a utility industry that has always relied on generation to keep the lights on.
Managing Both Sides Of The Equation
Shaping demand is not a new idea. Industrial customers in the United States have done it for decades, and Australia has managed home hot water heaters this way since well before smart devices existed. Virtual power plant companies such as Leap and Virtual Peaker enable homes and businesses to shift demand through incentivized utility programs. Data centers are now following the same pattern, but with far more load at a single site.
A February 2025 study at Duke University’s Nicholas Institute looked at what happens if data centers briefly curtail power use for a small fraction of their operating hours each year. The existing grid could absorb roughly 100 gigawatts of new load that way, without major new power plant investment. A follow-up study a year later projected that a 1% to 2% reduction in data center peak demand could lower retail electricity rates by roughly 0.5% to 2.8%.
A New Normal
While different tools than in telecom, the same principle applies: flexibility can meet reliability another way. Grid transformation poses the added challenge of indirect adoption. Wireless was pulled into being by consumers directly buying mobile phones. The grid’s flip has to be pushed, by data center operators and consumers demanding affordable power from utilities.
Wireless telecom won by proving the seemingly impossible could happen another way. The grid stands at the same threshold. The way through is not more generation alone but a grid that leverages the technology of this century to shape demand.