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Is Agentic AI Just Automation?

Why most of the agents are just flowcharts in disguise, and what to build instead.I wrote most of this at an airport several months ago and then left it in drafts. The noise has only gotten louder since, so here it is.A few months ago, on our way back from a client workshop, we were discussing the scope of what constitutes Agentic AI and all of us quoted examples from our experience. There was a discussion on why automation can’t solve it and how most of the agentic AI use cases are nothing but glorified automation. The question was, “Give me one real use case for an agent. Not a demo. Not automation. A real one. Because everything I have seen so far, I could have built with a workflow engine and a model call.”We all had been in agentic AI conversations for months at that point. We had architected these systems. We had pitched them. And still, sitting there with a tea and twenty minutes at our hand to spend, we had to think long enough to give an example that survived thirty seconds of scrutiny.That bothered me enough to write it down.The test I reached for firstMy instinct was to define agentic by the shape of the work.Does the task require the system to make decisions mid-execution that could not have been anticipated at the start? If yes, agent. If no, automation.I thought of an example from aviation maintenance, because that is where I had spent the previous six months.An A320 aircraft lands with an ECAM warning, AIR PACK 1 FAULT.What automation does: triggers a checklist, notifies the duty engineer, maybe pulls the MEL reference. Done.What traditional ML does: predicts probability of component failure from historical fault patterns, produces a confidence score. The engineer still decides.What I think an agent would do: it starts with the ECAM(a message in the cockpit systems of the aircraft) message, queries the CFDS(a centralised fault display system)for fault history and finds Pack 1 has thrown the same fault three times in six weeks. That changes the picture, so it pulls the TSM (troubleshooting manual) identifies four candidate root causes. It checks AMOS(a database used in aviation all over the world) for parts on hand and finds that two of those four need a Flow Control Valve, which is not at that station. It then checks which causes are deferrable under MEL(minimum equipment list, the minimum an aircraft needs to have to be air worthy), finds one deferrable under Category C(one of many categories)for ten days, looks at the aircraft’s next ten rotations to understand the operational cost of deferring, and drafts a recommendation: defer under Cat C, order the FCV(valve) for arrival before day eight, flag for deep inspection at the next base maintenance slot.Nobody pre-programmed that decision tree. The plan emerged from the process rather than preceding it.I still was not convinced with myself. And on reflection, I believe, I was right.Why that example failsBecause you can draw that flowchart.CFDS, then TSM, then AMOS, then MEL, then rotations. It is a complicated flowchart with branches, but a competent engineer could have specified it in advance. Complexity is not the same as open-endedness. A tree with two hundred branches is still a tree.This is the mistake almost every agentic pitch deck makes, mine included. We show something intricate and expect the intricacy to be self-evidently agentic. It is not. Intricacy is just a bigger flowchart, and flowcharts have a technology already, and it is cheaper, faster and far more reliable than any LLM you will put in that slot.So where is the actual line?Known unknowns versus unknown unknownsHere is the distinction I have settled on, and it is narrower than most people in this market are willing to admit.Automation handles known unknowns. You do not know whether the part is in stock, but you know that stock is a thing you need to check.Agents handle unknown unknowns. You do not know what you need to check, and you will only find out by looking.Take a use case that genuinely breaks automation: due diligence on an acquisition. The instruction is one line. Identify material risks in this target.No one can draw that flowchart upfront. The agent reads three thousand pages of contracts and notices an unusual indemnity clause in a supplier agreement. That clause references a regulatory filing, so it goes and fetches the filing. The filing hints at an informal environmental inquiry that appears nowhere in the data room. It then goes looking through news archives and court records to size the exposure and surfaces it as a risk that was never on anyone’s checklist.Nobody knew to look for that. The agent found a thread and pulled it. You cannot enumerate what you do not know exists.A second one, closer to the consumer world. A brand has a moisturiser generating complaints. Sentiment analysis flags them and a rule routes them to a team. Fine, that is automation and it works.The agentic version notices that the complaints cluster in humid climates, in summer months, and disproportionately from one retail chain. Nobody asked it to look at that intersection. It hypothesises a cold chain or formulation stability issue, pulls batch numbers, cross references manufacturing and logistics logs, and raises a possible recall exposure before a human has connected any of those dots.That property, where discovery changes direction in a way you could not have mapped, is the whole thing. Everything else is scaffolding.Why real examples are so hard to findThis is the part that took me longest to understand, and I think it is the most useful idea here. There could be gaps but still I want to crystallise the information.Enterprises have spent years deliberately engineering open-ended state out of their processes.That was rational. Human judgment is expensive, inconsistent and does not scale. So organisations built SOPs for every scenario, approval hierarchies with fixed triggers, rule based systems in ERP, CRM and WMS, and workflows where every decision point had a predetermined answer. A purchase order above fifty thousand goes to the CFO. Always. Not because that is the smartest possible rule, but because it is auditable and it scales.The goal was to make processes repeatable without requiring thinking.But when you remove ambiguity from a process, you also remove its ability to deal with anything the designers did not anticipate. So enterprises invented a pressure valve: the exception queue. Anything that does not fit gets escalated to a human. That human applies judgment. If the same exception recurs enough times, someone writes a new rule and it gets absorbed back into the process.Humans were the agents all along. They were sitting at the edges of the process, absorbing the unknown unknowns, and the org chart pretended that was not happening.So when a leadership team sits in a room and asks “where do we use agents”, they look at their core processes, find them fully specified, and conclude there is nothing here. Of course there is nothing there. They spent five decades making sure of it.The opportunity is not in the core. It is at the boundary, where the structured process meets messy reality. Where a supplier stops behaving the way the ERP expects. Where a customer complaint does not fit any category. Where a regulatory change quietly invalidates three workflows at once.So you want to start an agentic journeyThis is the question I get most often now, usually after someone’s board has asked them what their agentic strategy is. Here is what I would actually tell them.Image by authorStart from the exception queue, not from the use case list. Do not run an ideation workshop. Go find where your experienced people are spending their judgment today. Look at what gets escalated, what sits in someone’s inbox for two days, what requires a phone call to a colleague who “knows how this works.” That is your map. Those escalations are the fossil record of open-ended state in your organisation.Assume your bottleneck is access, not intelligence. Almost nobody fails because the model was not smart enough. They fail because the agent could not reach the data, or the document store had no usable metadata, or the source of truth for supplier terms turned out to be four spreadsheets on a shared drive. An agent’s ceiling is the set of things it can actually see and do. Budget accordingly, and be honest that a good part of your first year is plumbing. Had you have a good AI strategy, your agentic strategy will be much easier.Decide the autonomy level explicitly, and write it down. There are three modes: Recommend only, Act with approval, Act and report. Most enterprise use cases should live at recommend stage far longer than the anyone suggests, and there is no shame in that. A system that assembles the evidence dossier and hands it to a human is already removing the expensive part of the work.Build the evaluation harness before you build the agent. This is the discipline gap I see most often. If you cannot tell whether the agent reasoned well on a case, you cannot deploy it, you cannot improve it, and you certainly cannot defend it in an audit. Curate fifty real historical cases with known outcomes before you write a line of orchestration code. The golden set of QnA is what I see missing in most of agentic orchestrations, your system doesn’t need to pass all the cases that are in your golden set but at least it will guide you towards your point A and if you know where your point A is, then only you can go to point B.Change what governance is measuring. Deterministic systems are governed by asking, “was the rule followed”. Agentic systems have to be governed by asking “was the reasoning sound, was it within bounds, and can we reconstruct it.” That is a different control framework and your risk function will need to be brought along early, not shown a finished system.Pick a first domain where being wrong is recoverable. Not because agents are unreliable, but because you are going to learn things about your own data and processes that you would rather learn without a regulatory consequence attached.The uncomfortable part: greenfield is easier than retrofitThis one surprises people, and it runs against how most transformation programmes are structured.It is significantly easier to build an agentic system from scratch than to make an existing application or process agentic.The reason follows directly from everything above. An existing enterprise process has already had its ambiguity engineered out. That was the entire point of building it. So when you go to “make it agentic”, you find there is nothing left for an agent to do except execute a sequence of steps that a workflow engine performs more cheaply, more predictably and with better logging. You end up wrapping a language model around a deterministic process and paying more money for less determinism. I have watched teams do this and then wonder why the business case will not close.Retrofit also drags along everything the original system was designed for. Schemas built for transactions rather than reasoning. Permission models built for named human users rather than service identities acting on behalf of someone. Audit trails that assume a fixed path through the process. SLAs that assume a fixed number of steps. Interfaces that were designed to be clicked, not called. None of that is unsolvable, but it is where the calendar goes.Greenfield teams are not smarter. They simply have less to unlearn. They get to design the process around the properties an agent is good at: open state, iterative discovery, tool access, judgment under incomplete information.The practical middle path, and this is what is recommended: do not try to agentify the process. Leave the deterministic core exactly where it is, because it works. Agentify the exceptions that fall out of it. That is where the open-ended state already lives, that is where your expensive people are already spending their time, and it means you are adding a capability rather than replacing a working system with a probabilistic version of itself.And is automation the first step of an agentic journey?Sort of, but not in the way people mean it.Automation is not stage one of a maturity curve that ends in agents. They are not the same thing at different levels of sophistication. But automation is a prerequisite, in a specific and important sense: your automations become the tools your agents call. Every reliable API, every clean integration, every well defined action you have already built is something an agent can now use as a hand.An agent without solid automation underneath it is a very expensive intern with no hands. It can reason beautifully about what should happen and then do nothing about it.So the organisations best positioned for this are not the ones that skipped process automation to chase agents. They are the ones that did the boring integration work for a decade and now have something worth reasoning over.Where I have landedMost of what we see and term as agentic is automation with a better narrator. That is not a scandal. Automation is genuinely valuable and there is nothing wrong with selling it, as long as we call it what it is.The remaining part is real and it is genuinely new, because it addresses a category of work that no previous technology could touch. The work at the edges. The exception queue. The unknown unknowns that we quietly staffed with experienced humans and hoped for the best.That is the part worth building in the realms of agentic.The spirited discussion ended there at the tea shop but was there in my mind and thus, I wanted to crystallise my thoughts here.If you are working through this in your own organisation, I would be curious to hear where you have found genuine open-ended state, and where you concluded it was automation after all.

Why most of the agents are just flowcharts in disguise, and what to build instead.

I wrote most of this at an airport several months ago and then left it in drafts. The noise has only gotten louder since, so here it is.

A few months ago, on our way back from a client workshop, we were discussing the scope of what constitutes Agentic AI and all of us quoted examples from our experience. There was a discussion on why automation can’t solve it and how most of the agentic AI use cases are nothing but glorified automation. The question was, “Give me one real use case for an agent. Not a demo. Not automation. A real one. Because everything I have seen so far, I could have built with a workflow engine and a model call.”

We all had been in agentic AI conversations for months at that point. We had architected these systems. We had pitched them. And still, sitting there with a tea and twenty minutes at our hand to spend, we had to think long enough to give an example that survived thirty seconds of scrutiny.

That bothered me enough to write it down.

The test I reached for first

My instinct was to define agentic by the shape of the work.

Does the task require the system to make decisions mid-execution that could not have been anticipated at the start? If yes, agent. If no, automation.

I thought of an example from aviation maintenance, because that is where I had spent the previous six months.

An A320 aircraft lands with an ECAM warning, AIR PACK 1 FAULT.

What automation does: triggers a checklist, notifies the duty engineer, maybe pulls the MEL reference. Done.

What traditional ML does: predicts probability of component failure from historical fault patterns, produces a confidence score. The engineer still decides.

What I think an agent would do: it starts with the ECAM(a message in the cockpit systems of the aircraft) message, queries the CFDS(a centralised fault display system)for fault history and finds Pack 1 has thrown the same fault three times in six weeks. That changes the picture, so it pulls the TSM (troubleshooting manual) identifies four candidate root causes. It checks AMOS(a database used in aviation all over the world) for parts on hand and finds that two of those four need a Flow Control Valve, which is not at that station. It then checks which causes are deferrable under MEL(minimum equipment list, the minimum an aircraft needs to have to be air worthy), finds one deferrable under Category C(one of many categories)for ten days, looks at the aircraft’s next ten rotations to understand the operational cost of deferring, and drafts a recommendation: defer under Cat C, order the FCV(valve) for arrival before day eight, flag for deep inspection at the next base maintenance slot.

Nobody pre-programmed that decision tree. The plan emerged from the process rather than preceding it.

I still was not convinced with myself. And on reflection, I believe, I was right.

Why that example fails

Because you can draw that flowchart.

CFDS, then TSM, then AMOS, then MEL, then rotations. It is a complicated flowchart with branches, but a competent engineer could have specified it in advance. Complexity is not the same as open-endedness. A tree with two hundred branches is still a tree.

This is the mistake almost every agentic pitch deck makes, mine included. We show something intricate and expect the intricacy to be self-evidently agentic. It is not. Intricacy is just a bigger flowchart, and flowcharts have a technology already, and it is cheaper, faster and far more reliable than any LLM you will put in that slot.

So where is the actual line?

Known unknowns versus unknown unknowns

Here is the distinction I have settled on, and it is narrower than most people in this market are willing to admit.

Automation handles known unknowns. You do not know whether the part is in stock, but you know that stock is a thing you need to check.

Agents handle unknown unknowns. You do not know what you need to check, and you will only find out by looking.

Take a use case that genuinely breaks automation: due diligence on an acquisition. The instruction is one line. Identify material risks in this target.

No one can draw that flowchart upfront. The agent reads three thousand pages of contracts and notices an unusual indemnity clause in a supplier agreement. That clause references a regulatory filing, so it goes and fetches the filing. The filing hints at an informal environmental inquiry that appears nowhere in the data room. It then goes looking through news archives and court records to size the exposure and surfaces it as a risk that was never on anyone’s checklist.

Nobody knew to look for that. The agent found a thread and pulled it. You cannot enumerate what you do not know exists.

A second one, closer to the consumer world. A brand has a moisturiser generating complaints. Sentiment analysis flags them and a rule routes them to a team. Fine, that is automation and it works.

The agentic version notices that the complaints cluster in humid climates, in summer months, and disproportionately from one retail chain. Nobody asked it to look at that intersection. It hypothesises a cold chain or formulation stability issue, pulls batch numbers, cross references manufacturing and logistics logs, and raises a possible recall exposure before a human has connected any of those dots.

That property, where discovery changes direction in a way you could not have mapped, is the whole thing. Everything else is scaffolding.

Why real examples are so hard to find

This is the part that took me longest to understand, and I think it is the most useful idea here. There could be gaps but still I want to crystallise the information.

Enterprises have spent years deliberately engineering open-ended state out of their processes.

That was rational. Human judgment is expensive, inconsistent and does not scale. So organisations built SOPs for every scenario, approval hierarchies with fixed triggers, rule based systems in ERP, CRM and WMS, and workflows where every decision point had a predetermined answer. A purchase order above fifty thousand goes to the CFO. Always. Not because that is the smartest possible rule, but because it is auditable and it scales.

The goal was to make processes repeatable without requiring thinking.

But when you remove ambiguity from a process, you also remove its ability to deal with anything the designers did not anticipate. So enterprises invented a pressure valve: the exception queue. Anything that does not fit gets escalated to a human. That human applies judgment. If the same exception recurs enough times, someone writes a new rule and it gets absorbed back into the process.

Humans were the agents all along. They were sitting at the edges of the process, absorbing the unknown unknowns, and the org chart pretended that was not happening.

So when a leadership team sits in a room and asks “where do we use agents”, they look at their core processes, find them fully specified, and conclude there is nothing here. Of course there is nothing there. They spent five decades making sure of it.

The opportunity is not in the core. It is at the boundary, where the structured process meets messy reality. Where a supplier stops behaving the way the ERP expects. Where a customer complaint does not fit any category. Where a regulatory change quietly invalidates three workflows at once.

So you want to start an agentic journey

This is the question I get most often now, usually after someone’s board has asked them what their agentic strategy is. Here is what I would actually tell them.

Image by author

Start from the exception queue, not from the use case list. Do not run an ideation workshop. Go find where your experienced people are spending their judgment today. Look at what gets escalated, what sits in someone’s inbox for two days, what requires a phone call to a colleague who “knows how this works.” That is your map. Those escalations are the fossil record of open-ended state in your organisation.

Assume your bottleneck is access, not intelligence. Almost nobody fails because the model was not smart enough. They fail because the agent could not reach the data, or the document store had no usable metadata, or the source of truth for supplier terms turned out to be four spreadsheets on a shared drive. An agent’s ceiling is the set of things it can actually see and do. Budget accordingly, and be honest that a good part of your first year is plumbing. Had you have a good AI strategy, your agentic strategy will be much easier.

Decide the autonomy level explicitly, and write it down. There are three modes: Recommend only, Act with approval, Act and report. Most enterprise use cases should live at recommend stage far longer than the anyone suggests, and there is no shame in that. A system that assembles the evidence dossier and hands it to a human is already removing the expensive part of the work.

Build the evaluation harness before you build the agent. This is the discipline gap I see most often. If you cannot tell whether the agent reasoned well on a case, you cannot deploy it, you cannot improve it, and you certainly cannot defend it in an audit. Curate fifty real historical cases with known outcomes before you write a line of orchestration code. The golden set of QnA is what I see missing in most of agentic orchestrations, your system doesn’t need to pass all the cases that are in your golden set but at least it will guide you towards your point A and if you know where your point A is, then only you can go to point B.

Change what governance is measuring. Deterministic systems are governed by asking, “was the rule followed”. Agentic systems have to be governed by asking “was the reasoning sound, was it within bounds, and can we reconstruct it.” That is a different control framework and your risk function will need to be brought along early, not shown a finished system.

Pick a first domain where being wrong is recoverable. Not because agents are unreliable, but because you are going to learn things about your own data and processes that you would rather learn without a regulatory consequence attached.

The uncomfortable part: greenfield is easier than retrofit

This one surprises people, and it runs against how most transformation programmes are structured.

It is significantly easier to build an agentic system from scratch than to make an existing application or process agentic.

The reason follows directly from everything above. An existing enterprise process has already had its ambiguity engineered out. That was the entire point of building it. So when you go to “make it agentic”, you find there is nothing left for an agent to do except execute a sequence of steps that a workflow engine performs more cheaply, more predictably and with better logging. You end up wrapping a language model around a deterministic process and paying more money for less determinism. I have watched teams do this and then wonder why the business case will not close.

Retrofit also drags along everything the original system was designed for. Schemas built for transactions rather than reasoning. Permission models built for named human users rather than service identities acting on behalf of someone. Audit trails that assume a fixed path through the process. SLAs that assume a fixed number of steps. Interfaces that were designed to be clicked, not called. None of that is unsolvable, but it is where the calendar goes.

Greenfield teams are not smarter. They simply have less to unlearn. They get to design the process around the properties an agent is good at: open state, iterative discovery, tool access, judgment under incomplete information.

The practical middle path, and this is what is recommended: do not try to agentify the process. Leave the deterministic core exactly where it is, because it works. Agentify the exceptions that fall out of it. That is where the open-ended state already lives, that is where your expensive people are already spending their time, and it means you are adding a capability rather than replacing a working system with a probabilistic version of itself.

And is automation the first step of an agentic journey?

Sort of, but not in the way people mean it.

Automation is not stage one of a maturity curve that ends in agents. They are not the same thing at different levels of sophistication. But automation is a prerequisite, in a specific and important sense: your automations become the tools your agents call. Every reliable API, every clean integration, every well defined action you have already built is something an agent can now use as a hand.

An agent without solid automation underneath it is a very expensive intern with no hands. It can reason beautifully about what should happen and then do nothing about it.

So the organisations best positioned for this are not the ones that skipped process automation to chase agents. They are the ones that did the boring integration work for a decade and now have something worth reasoning over.

Where I have landed

Most of what we see and term as agentic is automation with a better narrator. That is not a scandal. Automation is genuinely valuable and there is nothing wrong with selling it, as long as we call it what it is.

The remaining part is real and it is genuinely new, because it addresses a category of work that no previous technology could touch. The work at the edges. The exception queue. The unknown unknowns that we quietly staffed with experienced humans and hoped for the best.

That is the part worth building in the realms of agentic.

The spirited discussion ended there at the tea shop but was there in my mind and thus, I wanted to crystallise my thoughts here.

If you are working through this in your own organisation, I would be curious to hear where you have found genuine open-ended state, and where you concluded it was automation after all.

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bp lets Shah Deniz compression automation contract

bp has let a contract to Emerson to deliver automation technologies for the Shah Deniz Compression project offshore Azerbaijan. Emerson will provide integrated control and safety systems aimed at enhancing production, safety, and reliability on the new offshore compression platform. The contract includes systems to provide process control, safety shutdown, fire and gas detection, and power management. Together, these systems deliver real-time visibility and remote control of critical operations, Emerson said. The $2.9 billion Shah Deniz Compression project, which includes an electrically powered, normally unattended offshore production platform, is a next stage development of the Caspian Sea Shah Deniz field. Designed to access low-pressure gas reserves and maximize overall recovery, the platform will be equipped with four 11 Mw compressors and serve as the central compression hub for gas from the Shah Deniz Alpha and Bravo platforms. The platform will operate remotely from bp’s onshore Sangachal terminal 55 km south of Baku. The project is expected to enable about 50 billion cu m of additional gas and about 25 million bbl of condensate production and export. Construction is scheduled to be completed in 2029, with first gas compression expected from the Shah Deniz Alpha platform in 2029 and from the Shah Deniz Bravo platform in 2030. The agreement follows a previous automation contract bp signed with Emerson for the Azeri Central East and Shah Deniz Stage 2 developments. bp is operator at Shah Deniz (29.99%) with partners Lukoil (19.99%), TPAO (19%), Cenub Qaz Dehlizi (16.02%), NICO (10%), and MVM (5%).

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Federal court voids Texas GulfLink license over agency’s ‘serious procedural errors’

The ruling voids the license, halting all construction or progress. Sentinel Midstream declined comment on the ruling and would not answer questions about the status of construction. GulfLink, sited about 30 miles offshore Freeport, Tex., is designed to export up to 1 million b/d via Very Large Crude Carriers (VLCCs) to the government of Japan and Freeport Commodities. The project involves a 44-mile, 42-in. OD pipeline and was scheduled to begin operations around 2028. The estimated $2.1 billion investment was funded as part of a broader trade agreement between the US and Japan. The legal battle stems from a specific rule in the Deepwater Port Act of 1974 that dictates that the federal government can only permit one crude oil deepwater port, including any supporting infrastructure, within a single designated “application area.” Because the competing SPOT project’s pipeline route physically overlaps and intersects GulfLink’s lines, the plaintiff—Citizens for Clean Air & Clean Water in Brazoria County (Better Brazoria), represented by Earthjustice—successfully argued that MARAD violated the “one port” rule when issuing GulfLink’s license in February. The three-judge panel found that MARAD “improperly drew” the map designing the project’s official boundaries to exclude the pipelines and approved two overlapping projects in the same zone instead of only licensing one. The court wrote that the scope of the error made vacatur, not the less serious remand without vacatur, the appropriate remedy. Vacatur deems the license invalid and is used when the court finds “serious procedural errors” that cannot be easily explained or fixed with minor changes. Remand without vacatur sends the decision back to the agency for corrections but leaves the current license in place in the meantime. SPOT project status The $2.5-3-billion SPOT project, developed by Enterprise Products Partners in partnership with Enbridge Inc., also lies about 30 miles from Freeport. Designed to handle VLCCs,

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IBM unveils dual-architecture processor to run Arm-native apps on Z mainframes

“These caches have enormously low latency, and that is one of the key reasons and key engineering choices to support the performance and scalability of enterprise workloads, very data-intensive workloads like databases and transactions,” Jacobi said. “In addition, we have an on-chip data processing unit for IO acceleration and dedicated AI accelerators as well as accelerators for data compression, cryptography and data sorting.” One of the biggest takeaways from this processor announcement is that the enormous catalog of software already built for Arm becomes accessible on a mainframe without anyone having to port it first, notes Matt Kimball, senior datacenter analyst at Moor Insights & Strategy, in a research note about the news. Still, “this is a 2027 conversation, and with no date, supported software list, or Arm licensing treatment, the work now is inventory and scenario planning rather than financial modeling,” Kimball wrote.

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PJM’s New Data Center Power Equation

PJM Interconnection has now filed one of the most consequential proposed changes yet in the relationship between data centers and the electric grid. Rather than simply treating a new hyperscale or AI facility like any other customer whose demand will be backed through regional capacity procurement, PJM is proposing a framework under which the largest new loads would need to be supported by new capacity, have their needs covered through the Reliability Backstop Procurement, or face potential curtailment when the regional power system is short of supply. The approach has been developing since PJM launched its Critical Issue Fast Path process for large loads in 2025, but it became substantially more concrete in late July and August 2026. PJM filed its proposed Reliability Backstop Procurement with FERC on July 31 and began accepting applications that day for its FERC-approved Expedited Interconnection Track. On Aug. 13, PJM filed its proposed Interim Resource Adequacy Service, or IRAS, along with the Large Load Registry that would support it. The immediate numbers explain the urgency. PJM’s July 2026 capacity auction for the 2028/2029 delivery year procured 138,318 MW of unforced capacity through the centralized auction. Even after including Fixed Resource Requirement resources, however, PJM came up 6,831 MW short of its reliability requirement. The auction cleared at the FERC-approved $325/MW-day price cap. It was the second consecutive auction in which the PJM region failed to procure its full reliability requirement, something that had not happened before these two auctions. That gap is occurring while demand continues to accelerate. PJM’s 2026 long-term forecast projects summer peak demand growing at an average 3.6% annually over the next decade, compared with just 0.3% in the comparable forecast issued in 2021. Summer peak demand is projected to rise by nearly 66 GW over 10 years. Data centers are

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Zayo, NVIDIA Build the Long-Haul Backbone for Distributed AI

The data center industry’s increasingly power-first approach to site selection has created a follow-on question: Once the megawatts are found, is there enough network infrastructure to make the site useful at AI scale? Zayo and NVIDIA are putting real infrastructure behind that question. Zayo said it is working with NVIDIA to expand network capacity supporting AI factories across North America, including an 8,000-route-mile program targeting some of the fastest-growing AI corridors in the United States. The project encompasses six new long-haul routes along with overbuilds of existing network across 10 high-demand corridors. The announcement arrives as AI data center development moves beyond the largest established hubs toward markets where power and land may be more readily available, but fiber capacity cannot necessarily be taken for granted. That geography is increasingly important. NVIDIA has separately developed “scale-across” networking technology designed to allow AI infrastructure distributed among different buildings — or even data centers separated by hundreds of kilometers — to operate as a more unified computing environment. Put together, the developments suggest that networking is becoming inseparable from the AI factory buildout itself. Power may determine where the next generation of AI infrastructure can be built. Fiber will increasingly determine how effectively those sites can participate in the larger AI ecosystem. Fiber Follows the Power Zayo CEO Steve Smith said AI demand is changing both where network infrastructure is needed and how aggressively capacity must be deployed ahead of development. “AI is fundamentally reshaping where and how network infrastructure needs to be built across the U.S.,” Smith said. The company’s 8,000-mile program is more nuanced than that top-line number might suggest. Zayo disclosed in April that the expansion includes approximately 3,000 route miles across six new long-haul routes, plus more than 5,000 route miles of overbuilds across 10 existing corridors. Zayo

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Southern’s 17 GW Pipeline Puts AI Power Demand Into Utility Math

The headline number from Southern Company’s latest earnings report is hard to miss: electricity use by data centers across the utility’s system increased 55% in the second quarter compared with a year earlier. But the more consequential numbers may be the ones sitting behind it. Southern now has more than 1.2 GW of operating data center load, up by more than 500 MW from a year ago. At the same time, its electric utilities have signed contracts and large-load agreements totaling more than 17 GW by the mid-2030s, with another 8 GW in late-stage development and a prospective pipeline of large industrial and data center projects exceeding 75 GW. That leaves an enormous gap between the data center megawatts consuming electricity today and the load Southern has contractually positioned itself to serve during the next decade. For the data center industry, that gap may be the most important part of Southern’s second-quarter story. It offers a look at how utilities are beginning to convert the AI infrastructure boom from forecasts and campus announcements into contracts, generation procurement, transmission investment and eventually energized capacity. From Contracts to Megawatts Southern added roughly 6 GW of contracted large load during the quarter alone. Alabama Power signed three projects representing about 3 GW, while Georgia Power reached a 25-year agreement to serve OpenAI’s planned project in Effingham County near Savannah. That facility is expected to require approximately 3.2 GW and begin taking electric service in phases in 2028. The numbers nevertheless require an important distinction. Seventeen gigawatts contracted does not mean 17 GW will suddenly appear on Southern’s grid. Large data center campuses ramp gradually, often over several years, and Southern executives acknowledged that actual customer ramp schedules do not always match the assumptions made when projects are first approved. CEO Chris Womack said

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PORTS-Pike Takes Shape as an 8-GW AI Infrastructure Model

Back on March 31, 2026, we discussed we discussed SoftBank and SB Energy’s plans to redevelop the former Portsmouth Gaseous Diffusion Plant site near Piketon as a 10-GW artificial intelligence data center campus supported by almost an equal amount of new power generation. At the time, the plan called for as much as 10 GW of new generation, including 9.2 GW of natural gas capacity, along with approximately $4.2 billion of high-voltage transmission infrastructure developed with AEP Ohio. An initial 800-MW data center phase was targeted for service in 2028. The March story was notable because Pike County appeared to offer a preview of a new model for building hyperscale infrastructure: develop the generation, transmission and data center simultaneously rather than wait for an increasingly congested regional grid to deliver multiple gigawatts of capacity. Not to mention the reuse of a brownfield site with the encouragement of the federal government. Since then, almost every important part of the project has moved forward, and on August 17, the most consequential missing pieces fell into place. NVIDIA announced that it will become the exclusive AI compute infrastructure provider for the PORTS-Pike Technology Campus. OpenAI will be the data center customer, signing a 20-year lease with SB Energy for approximately 8 GW of IT capacity. NVIDIA will invest another $1.5 billion in SB Energy and provide credit support for the land, power and shell infrastructure behind an initial 4.25 GW of IT load, with an option covering approximately another 3.75 GW. The Securities and Exchange Commission filing accompanying the announcement makes the financial commitment even more significant. NVIDIA disclosed that its aggregate payment obligation associated with its initial commitment is capped at $105 billion. That is not a conventional capital commitment to spend $105 billion building the campus, nor is it simply a

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Nvidia scales back financing guarantee for OpenAI data center

Nvidia is scaling back a proposed financial guarantee tied to a massive OpenAI data center project in Ohio, reducing its initial commitment from as much as $250 billion to less than $120 billion, according to report in the Wall Street Journal. Earlier this month, Nvidia announced partnerships with major financial firms including Apollo Global Management, BlackRock, Blackstone, Brookfield Asset Management, Goldman Sachs and KKR, aimed at mobilizing more than $500 billion in capital for AI computing infrastructure. The change represents a significant restructuring of Nvidia’s role in financing the planned facility, which is being developed by SB Energy, a subsidiary of SoftBank. Under the revised arrangement, Nvidia would guarantee financing for the project’s first phase, representing roughly 5 gigawatts of capacity, or half of the total proposed capacity. Financing for the remaining capacity would be considered separately at a later stage.

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Microsoft will invest $80B in AI data centers in fiscal 2025

And Microsoft isn’t the only one that is ramping up its investments into AI-enabled data centers. Rival cloud service providers are all investing in either upgrading or opening new data centers to capture a larger chunk of business from developers and users of large language models (LLMs).  In a report published in October 2024, Bloomberg Intelligence estimated that demand for generative AI would push Microsoft, AWS, Google, Oracle, Meta, and Apple would between them devote $200 billion to capex in 2025, up from $110 billion in 2023. Microsoft is one of the biggest spenders, followed closely by Google and AWS, Bloomberg Intelligence said. Its estimate of Microsoft’s capital spending on AI, at $62.4 billion for calendar 2025, is lower than Smith’s claim that the company will invest $80 billion in the fiscal year to June 30, 2025. Both figures, though, are way higher than Microsoft’s 2020 capital expenditure of “just” $17.6 billion. The majority of the increased spending is tied to cloud services and the expansion of AI infrastructure needed to provide compute capacity for OpenAI workloads. Separately, last October Amazon CEO Andy Jassy said his company planned total capex spend of $75 billion in 2024 and even more in 2025, with much of it going to AWS, its cloud computing division.

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John Deere unveils more autonomous farm machines to address skill labor shortage

Join our daily and weekly newsletters for the latest updates and exclusive content on industry-leading AI coverage. Learn More Self-driving tractors might be the path to self-driving cars. John Deere has revealed a new line of autonomous machines and tech across agriculture, construction and commercial landscaping. The Moline, Illinois-based John Deere has been in business for 187 years, yet it’s been a regular as a non-tech company showing off technology at the big tech trade show in Las Vegas and is back at CES 2025 with more autonomous tractors and other vehicles. This is not something we usually cover, but John Deere has a lot of data that is interesting in the big picture of tech. The message from the company is that there aren’t enough skilled farm laborers to do the work that its customers need. It’s been a challenge for most of the last two decades, said Jahmy Hindman, CTO at John Deere, in a briefing. Much of the tech will come this fall and after that. He noted that the average farmer in the U.S. is over 58 and works 12 to 18 hours a day to grow food for us. And he said the American Farm Bureau Federation estimates there are roughly 2.4 million farm jobs that need to be filled annually; and the agricultural work force continues to shrink. (This is my hint to the anti-immigration crowd). John Deere’s autonomous 9RX Tractor. Farmers can oversee it using an app. While each of these industries experiences their own set of challenges, a commonality across all is skilled labor availability. In construction, about 80% percent of contractors struggle to find skilled labor. And in commercial landscaping, 86% of landscaping business owners can’t find labor to fill open positions, he said. “They have to figure out how to do

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2025 playbook for enterprise AI success, from agents to evals

Join our daily and weekly newsletters for the latest updates and exclusive content on industry-leading AI coverage. Learn More 2025 is poised to be a pivotal year for enterprise AI. The past year has seen rapid innovation, and this year will see the same. This has made it more critical than ever to revisit your AI strategy to stay competitive and create value for your customers. From scaling AI agents to optimizing costs, here are the five critical areas enterprises should prioritize for their AI strategy this year. 1. Agents: the next generation of automation AI agents are no longer theoretical. In 2025, they’re indispensable tools for enterprises looking to streamline operations and enhance customer interactions. Unlike traditional software, agents powered by large language models (LLMs) can make nuanced decisions, navigate complex multi-step tasks, and integrate seamlessly with tools and APIs. At the start of 2024, agents were not ready for prime time, making frustrating mistakes like hallucinating URLs. They started getting better as frontier large language models themselves improved. “Let me put it this way,” said Sam Witteveen, cofounder of Red Dragon, a company that develops agents for companies, and that recently reviewed the 48 agents it built last year. “Interestingly, the ones that we built at the start of the year, a lot of those worked way better at the end of the year just because the models got better.” Witteveen shared this in the video podcast we filmed to discuss these five big trends in detail. Models are getting better and hallucinating less, and they’re also being trained to do agentic tasks. Another feature that the model providers are researching is a way to use the LLM as a judge, and as models get cheaper (something we’ll cover below), companies can use three or more models to

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OpenAI’s red teaming innovations define new essentials for security leaders in the AI era

Join our daily and weekly newsletters for the latest updates and exclusive content on industry-leading AI coverage. Learn More OpenAI has taken a more aggressive approach to red teaming than its AI competitors, demonstrating its security teams’ advanced capabilities in two areas: multi-step reinforcement and external red teaming. OpenAI recently released two papers that set a new competitive standard for improving the quality, reliability and safety of AI models in these two techniques and more. The first paper, “OpenAI’s Approach to External Red Teaming for AI Models and Systems,” reports that specialized teams outside the company have proven effective in uncovering vulnerabilities that might otherwise have made it into a released model because in-house testing techniques may have missed them. In the second paper, “Diverse and Effective Red Teaming with Auto-Generated Rewards and Multi-Step Reinforcement Learning,” OpenAI introduces an automated framework that relies on iterative reinforcement learning to generate a broad spectrum of novel, wide-ranging attacks. Going all-in on red teaming pays practical, competitive dividends It’s encouraging to see competitive intensity in red teaming growing among AI companies. When Anthropic released its AI red team guidelines in June of last year, it joined AI providers including Google, Microsoft, Nvidia, OpenAI, and even the U.S.’s National Institute of Standards and Technology (NIST), which all had released red teaming frameworks. Investing heavily in red teaming yields tangible benefits for security leaders in any organization. OpenAI’s paper on external red teaming provides a detailed analysis of how the company strives to create specialized external teams that include cybersecurity and subject matter experts. The goal is to see if knowledgeable external teams can defeat models’ security perimeters and find gaps in their security, biases and controls that prompt-based testing couldn’t find. What makes OpenAI’s recent papers noteworthy is how well they define using human-in-the-middle

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