AI is turning energy into the hottest business in America

The explosion of artificial intelligence is pushing companies across all sectors—from tech giants to automakers—into the heart of the energy market. The race for electricity has become the new gold rush behind the AI boom, creating immense financial value and an equally large risk should demand fail to keep pace. Electricity, long treated as a cheap and abundant commodity, is now emerging as one of the most valuable strategic assets in business. As Brian Janous, co-founder of Cloverleaf Infrastructure and Microsoft's first energy hire 15 years ago, put it, "everyone, in some way, relies on energy as a primary input or sees a major opportunity in it."

Recently, Ford announced its expansion into energy storage for data centers and other large energy consumers, launching a new subsidiary called Ford Energy. This is in response to the "huge demand for home energy storage." And investors are watching. Companies pivoting toward the power behind the AI boom are being rewarded. Ford, for instance, saw its stock price rise to its highest level in three years after launching the $2 billion energy business. Bloom Energy, long viewed as a niche player, saw its shares skyrocket over 1,200% in the last year. Fervo Energy, a geothermal energy startup, also saw a significant surge after going public, while GE Vernova recorded $2.4 billion in electrical equipment orders for data centers in the first quarter of this year alone.

Andy Power, president and CEO of Digital Realty, one of the world's largest data center companies, highlighted that "the power behind artificial intelligence is invisible to most people, but it is massive." He adds that while building digital infrastructure is not new, what has changed is the pace. Utilities are being flooded with power requests and must prioritize who is real. However, behind the rising stocks, problems are piling up. Opposition to data centers is growing rapidly, and some of the largest projects may never materialize. Brian Janous warned that "a lot of people are going to lose a lot of money in this space," not due to a lack of demand, but because too many mega-projects are competing for that demand.

The number of data centers canceled following community resistance reached a record in the first quarter of this year, representing over $40 billion in investment. Community concerns over water usage, air pollution, and noise are the primary issues. But like any gold rush, this AI energy boom is also spawning a new generation of startups developing products for data centers, some of which could help resolve these concerns. Microsoft, Google, Amazon, and Meta are teaming up with the nonprofit Elemental Impact to accelerate new technologies, using data centers as test cases. If these startups scale, some could help address concerns, particularly around water use and air pollution.

Ultimately, for decades, energy was just an input. In the AI era, it is becoming the product itself.