Investors Turn to Regulated Utilities as Safer Bet Amid AI Power Rush

Wall Street firms are shifting capital toward regulated utility assets after OpenAI's plan for a massive fossil-fuel plant highlighted the risks of off-grid AI data centers.

OpenAI announced a partnership to build what could become the United States' largest fossil-fuel power plant, a move that highlights the growing appetite for off-grid energy solutions to power AI workloads. This development has prompted private-equity investors, exemplified by Jeff Jenkins of Bernhard Capital Partners, to favor regulated utility holdings that offer government-guaranteed returns rather than speculative, deregulated projects.

In states like Ohio, where the OpenAI plant will sit, utilities compete on market prices, while regulated markets such as Louisiana provide fixed rates and more predictable profits. Bernhard has completed several acquisitions of regulated gas and power firms, including a Louisiana company contracted by Meta for the Delta Forge 1 data center. Global private-equity investment in utilities reached $69 billion in 2025, a 50 percent rise year over year, sparking concerns about increased reliance on gas and political pressure during an election year.

Officials stress that regulated utilities must isolate data-center costs to avoid raising broader consumer rates. Jenkins expects a future wave of utility owners to sell assets back at a premium after the current construction boom subsides.