What is changing
After two decades of flat electricity demand in the United States, demand is rising again: data centres, the electrification of transport and heating, and the return of manufacturing. The grid that must carry it was built for the old demand, and the utilities, equipment makers and developers who expand it have multi-year backlogs.
How we express it
Through the regulated utilities whose allowed returns rise with the capital they deploy, the makers of transformers, turbines and switchgear, and the developers of generation and storage, held through liquid vehicles rather than single projects.
How it is sized
Not yet held. This is a research thesis: we are studying it, and if it is adopted it will be a sleeve on the core with a position limit, for clients whose policy allows a growth allocation.
What would make it wrong
Demand forecasts that do not materialise because compute becomes far more efficient; a regulatory turn that caps utility returns; or the build-out being financed in ways that dilute the listed companies’ shareholders.
Who it is for
If adopted, clients with a long horizon who already hold the core and want a lower-volatility expression of the compute theme than the technology companies themselves.
This material is for informational purposes only and is not a recommendation to buy or sell any security. All investing involves risk, including loss of principal.