AI heating up energy market. Experts predict issues

The artificial intelligence boom that propelled the S&P 500 to record highs is transforming the U.S. utilities sector. Traditionally viewed as stable and low-growth, energy companies have become one of the fastest-rising segments on the market. Since late 2023, the utilities index has surged about 43%, with a 20% gain in 2025 alone—the first back-to-back double-digit rise since 1990. The driver is soaring electricity demand from AI data centers. Shares of independent power producers like NRG Energy (+78%), Constellation Energy (+60%), and Vistra (+35%) are outperforming tech stocks.

Once a defensive haven, the sector is now cyclical and riskier, tied to AI spending trends. Analysts warn that any slowdown in AI investment could sharply reduce valuations.

(pb.pl)