For Utilities, AI Poses Questions Of Capacity And Affordability
Summarize this article with:
Neuberger Berman3.24K FollowersFollow5ShareSavePlay(15min)CommentsSummaryThe data center buildout is helping drive electricity demand, utility capex and issuance, but it is also fomenting risks tied to regulation and stranded generation capacity.As artificial intelligence shakes up the economy and markets, the need for a massive buildout of data center infrastructure has become clear.Artificial intelligence requires enormous computing capacity, which has led to the acceleration of data center construction across the U.S., including hotspots in the Upper Midwest, Mid-Atlantic states, and Texas.To meet the AI challenge, utilities have been increasing their capital expenditures significantly in recent years, with capex rising 17% year-over-year in 2025 and a projected 6% in 2026. PK24/iStock via Getty Images By Jonathan Gauntt The data center buildout is helping drive electricity demand, utility capex and issuance, but it is also fomenting risks tied to regulation and stranded generation capacity. As artificial intelligence shakes up theThis article was written byNeuberger Berman3.24K FollowersFollowNeuberger Berman was founded in 1939 to do one thing: deliver compelling investment results for our clients over the long term. This remains our singular purpose today, driven by a culture rooted in deep fundamental research, the pursuit of investment insight and continuous innovation on behalf of clients, and facilitated by the free exchange of ideas across the organization. From offices in 39 cities across 26 countries, Neuberger Berman manages a range of equity, fixed income, private equity and hedge fund strategies on behalf of institutions, advisors and individual investors worldwide. With 763 investment professionals and 2,850 employees in total, Neuberger Berman has built a diverse team of individuals united in their commitment to client outcomes and investment excellence. Our culture has afforded us enviable retention rates among our senior investment staff, and has earned us citations as first or second (among those with 1,000 or more employees) in the Pensions & Investments “Best Places to Work in Money Management” survey each year since 2014. As a private, independent, employee-owned investment manager, Neuberger Berman is structurally aligned with the long-term interests of our clients. We have no external parent or public shareholders to serve, nor other lines of business to distract us from our core mission. And with our employees and their families invested alongside our clients—plus 100% of employee deferred cash compensation directly linked to team and firm strategies—we are truly in this together. The firm has $538 billion in assets under management as of June 30, 2025. For more information, please visit our website at www.nb.com.For important disclosures: https://www.nb.com/disclosure-global-communications