Global data center electricity consumption is projected to more than double by 2028, driven almost entirely by AI workloads. The challenge: building power generation and transmission infrastructure takes 3-7 years, while AI demand is growing quarterly. This mismatch creates a structural power deficit that constrains where and how fast AI infrastructure can be deployed.
Several hyperscalers have already reported delaying data center deployments due to power availability. Microsoft, Google, and Amazon are all investing in long-term power contracts, nuclear partnerships, and on-site generation — signaling that they view power as the binding constraint on their AI ambitions.
Power generation: Nuclear (Constellation Energy, NuScale, Oklo), natural gas (Calpine, Vistra), and utility-scale solar/battery storage all benefit from hyperscaler demand for reliable baseload power.
Power delivery: Transformers and switchgear are bottlenecked — Eaton, Schneider Electric, and niche players see extended order backlogs.
Power efficiency: Liquid cooling reduces power wasted as heat. Every watt saved on cooling is a watt available for compute. Vertiv and Modine are the primary beneficiaries.
The power constraint is tracked through the Energy layer of the Functional Index. It's an increasingly important component of the Weekly Signal's Macro dimension — power availability affects where CapEx can be deployed.
Cooling as Investment Theme →Functional Index →CapEx Cliff Question →