by Ian Cooper

With the artificial intelligence boom showing no signs of slowing, NextEra just announced it was buying Dominion in an all-stock deal that will unite two key players in a race to meet explosively growing demand from AI data centers. NextEra will own about 74.5% of the combined company. Dominion investors will own about 25.5%.

“Electricity demand is rising faster than it has in decades,” NextEra CEO John Ketchum said in a statement. “We are bringing NextEra Energy and Dominion Energy together because scale matters more than ever.”

Even better, we could see many more deals just like this.

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After all, a typical AI data center consumes about 1.75 billion kilowatt-hours of electricity per year. To put that into perspective, the average American home uses about 10,800 kilowatt-hours annually. That means just one single AI data center uses as much electricity as roughly 162,037 American homes.

And with AI giants like Google, Amazon, Microsoft and OpenAI planning to build thousands to datacenters in the U.S., more energy will be needed.

In addition, according to the International Energy Agency, by 2030 these AI data centers will demand as much electricity as entire developed nations like Germany or Japan. Plus, according to Goldman Sachs, “global power demand from data centers will increase 50% by 2027 and by as much as 165% by the end of the decade (compared with 2023).”

And, according to the International Energy Agency (IEA):

“Global electricity demand from data centres is set to more than double over the next five years, consuming as much electricity by 2030 as the whole of Japan does today. The effects will be particularly strong in some countries. For example, in the United States, data centres are on course to account for almost half of the growth in electricity demand; in Japan, more than half; and in Malaysia, as much as one-fifth.”

That’s creating opportunity in stocks such as:

Sempra Energy

With a yield of 2.91%, Sempra (NYSE: SRE) is a leading North American energy infrastructure company focused on delivering energy to nearly 40 million consumers.

As owner of one of the largest energy networks on the continent, Sempra is electrifying and improving the energy resilience of some of the world’s most significant economic markets, including California, Texas, Mexico and global energy markets.

PG&E Corporation

With a yield of 1.24%, PG&E Corp. (NYSE: PCG) is a holding company, which engages in generation, transmission, and distribution of electricity and natural gas to customers. It specializes in energy, utility, power, gas, electricity, solar and sustainability. It’s also the parent company of Pacific Gas and Electric Company, an energy company that serves 16 million Californians across a 70,000-square-mile service area in Northern and Central California.