Amid rising geopolitical uncertainty, energy transition pressures and rapid technological disruption, energy companies are steadily advancing towards AI-enabled transformation, with stronger focus on data governance, cybersecurity and value realisation, according to the KPMG Global Tech Report 2026 – Energy, Natural Resources and Chemicals (ENRC).
The report draws on insights from 258 technology leaders across 22 countries and territories covering oil and gas, power and utilities, mining, chemicals and renewable energy sectors.
AI adoption gathers pace
The report said AI adoption is rapidly moving from pilot projects to enterprise-wide deployment across front- and back-office functions, helping organisations improve productivity and operational efficiency.
Organisations in the pilot stage are expected to decline sharply from 29% to just 2% within a year, reflecting a decisive shift towards scaled AI implementation.
For India, these trends assume greater significance as companies seek to balance growth, sustainability and resilience. Increasing digitalisation across the energy value chain is supporting AI-led operational efficiency and decarbonisation goals, even as legacy systems, cybersecurity risks and data complexity continue to shape transformation priorities.
Data and governance remain critical
While AI adoption is accelerating, the report noted that many organisations continue to face challenges in unlocking its full value. Legacy infrastructure, gaps in data readiness and governance complexities remain key barriers, highlighting the need for stronger data foundations and responsible AI frameworks.
The report found that 47% of organisations said their data and analytics initiatives are funded and progressing as planned, followed by cybersecurity (42%) and AI (41%).
Around 60% of executives identified legacy systems as a major obstacle to achieving full returns on technology investments, while 42% said improving data flows to support faster decision-making remains a top priority.
Cybersecurity and AI top investment priorities
According to the report, 69% of energy leaders identified AI as a priority investment area, compared with the cross-sector average of 77%.
Nearly 96% of respondents believe managing AI agents will become a critical workforce capability within the next five years. The report also found that 36% of organisations expect improved cybersecurity management to be the biggest outcome of technology investments.
Nearly three-quarters of executives highlighted balancing speed, cost efficiency and governance as a key challenge in deploying new technologies. Around 40% reported achieving returns on investment of 200% or more from digital initiatives, although most organisations continue to operate closer to break-even levels.
Spokesperson speaks
KPMG International, Global Head – Energy, Natural Resources and Chemicals (ENRC), Anish De said, “There is an exciting path ahead, although many hurdles to overcome. I firmly believe that AI and other emerging technology can benefit all businesses who adopt it with a clear strategy, strong governance, and a human-centric approach that provides the right support for the workforce. I encourage energy leaders to keep up the momentum, converting technology investments into sustained operational performance and growing financial returns.”
KPMG in India, Associate Partner, Business Consulting & Chair, AI for Energy, Shreyansh Upadhyay said, “AI adoption in the energy sector is moving from ambition to execution with a focus on value realisation. Unlocking value will depend on strong data foundations, domain context and enterprise-wide implementation, alongside addressing data, governance, and talent challenges.”