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Beneath the obvious AI hyperscaler stocks — Meta, Nvidia and so on — lies another layer of trades: the energy companies providing the power AI needs to, for instance, edit your ex out of the family photo.
Vistra, one of the leading US power generators, reports this morning as it builds out capacity to meet the demand of AI giants. Rival power provider Constellation Energy meanwhile boosted its forecast for the year yesterday after reporting $7.5 billion in second-quarter sales.
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Data Centers’ Power Deficit
US power use is expected to keep notching record highs in 2026 and 2027, according to the Energy Information Administration. Data centers could suck up a fifth of the US’s total electricity in 2035, up from about 6% today, BloombergNEF found. In states with more data centers, including Texas, that share is expected to be higher. The grid’s already strained, and the record amount of capacity it’s been able to supply to data centers in the past is just over 7 gigawatts a year (one gigawatt is roughly the equivalent of one nuclear reactor). BloombergNEF analysts expect the grid to come 19 gigawatts short of what data centers demand by 2035.
To fill the gap, hyperscalers and power companies like Vistra and Constellation are trying to create sparks any way they can:
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AI is sourcing its juice from both natural-gas and nuclear options. Earlier this year, Vistra struck a deal to buy Cogentrix Energy and its 10 gas-fired power plants for $4.7 billion and reached a 20-year agreement that’ll see Meta buy power from some of Vistra’s nuclear plants.
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Constellation Energy has forged deals to supply nuclear power to Meta and Microsoft. Constellation said in 2024 it plans to restart Three Mile Island, where the US’s worst nuclear meltdown occurred. The power generated there will supply Microsoft.
Not Overnight: AI’s demand could continue to outpace power providers’ ability to meet it, straining the grid and pushing up electricity prices. When explaining Vistra’s projections for how quickly it could increase its available power supply, president and CEO Jim Burke hedged investors’ expectations this spring, saying, “The physical world takes much longer to develop than what people might imagine it takes.”
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