"Data center electricity consumption is on pace to exceed 1,000 terawatt-hours by 2030, up from just 460 TWh in 2024, and it will comprise 10% of the U.S.' power consumption. Utilities ETFs like Virtus Reaves Utilities ETF (NYSEARCA:UTES), First Trust NASDAQ Clean Edge Smart Grid Infrastructure Index Fund (NASDAQ:GRID), and First Trust Utilities AlphaDEX Fund (NYSEARCA:FXU) are well positioned to benefit, not just from electricity demand, but all the downstream effects from an ongoing rapid buildout of infrastructure to support them."
"These utility ETFs are no longer synonymous with boredom and retiree income. That's the old story. The new story is that the sector posted earnings growth of 23.1% in Q3 2025, which made it the third fastest-growing sector. State Street ended up calling this 'a new era of growth'."
"UTES is one of the most compelling buys if you want strong gains without being bogged down by losers. This ETF is actively managed, and this is a positive because the best opportunities in the AI demand supercycle are not evenly distributed across the utility sector. Active ETFs have management teams picking stocks for you, and this one is a direct play on what it calls a 'power demand supercycle'."
Data center electricity demand is projected to more than double from 460 TWh in 2024 to 1,000 TWh by 2030, representing 10% of U.S. power consumption. This surge is transforming the utility sector from a stagnant income play into a high-growth investment opportunity. Utilities posted 23.1% earnings growth in Q3 2025, making it the third fastest-growing sector. Three utility ETFs—Virtus Reaves Utilities ETF (UTES), First Trust NASDAQ Clean Edge Smart Grid Infrastructure Index Fund (GRID), and First Trust Utilities AlphaDEX Fund (FXU)—are positioned to capitalize on this growth through infrastructure expansion. Despite strong fundamentals, utility ETFs remain undervalued as investors cling to outdated perceptions of the sector as boring and income-focused.
#data-center-infrastructure #utility-sector-growth #etf-investment #electricity-demand #ai-and-energy
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