Siemens Energy: Between the AI Boom and Aging Wind Turbines
The energy transition and the rapid expansion of AI data centers are driving massive demand for grid infrastructure. Siemens Energy sits at the intersection of both megatrends. Data centers not only require enormous amounts of electricity but, above all, a perfectly regulated voltage; otherwise, the sensitive AI chips will fail. This is precisely where the company delivers with transformers and switchgear. Added to this are gas turbines as a reliable backup solution for the fluctuating feed-in from wind and solar. Tech giants like Microsoft or Meta must expand their capacities “at any cost,” which gives Siemens Energy a strong negotiating position. The Grid Tech division recently reported a 41% increase in orders.
The latest quarterly figures underscore this momentum. Order intake climbed to a record high of EUR 17.7 billion, while the order backlog grew to EUR 154 billion. Free cash flow before taxes nearly doubled to just under EUR 2 billion in the second quarter. Accordingly, management raised its full-year forecast with confidence. Instead of 11–13%, comparable revenue growth is now expected to be 14–16%, and the adjusted EBIT margin before special items is projected to reach 10–12%. The strong cash inflow also allows for an acceleration of share buybacks. In total, shareholders will receive up to EUR 3.6 billion in dividends this fiscal year.
But things are not running completely smoothly yet. The wind power subsidiary Siemens Gamesa remains in the red, even though the loss shrank significantly from EUR 249 million to EUR 44 million. Management has made reaching the break-even point in the second half of the year a condition for the overall forecast. Added to this are geopolitical risks in the Middle East and potential US tariffs, which are currently considered manageable, however. Overall, the group is in a solid position, with record orders, strong cash flow, and a clear strategic focus on electrification markets. However, the Gamesa issue remains a point investors should keep an eye on. The stock is currently trading at around EUR 159.62.
RE Royalties: The Quiet Beneficiary of AI-Driven Power Demand
Renewable energy requires capital, and that is precisely where the Canadian specialty financier RE Royalties comes in. While wind and solar farm operators handle construction and maintenance, the company provides the funding. In return, it secures long-term revenue shares from the projects. A model similar to the well-known royalty structures in the mining industry, but cleaner and more predictable. The AI boom is devouring vast amounts of electricity, and data centers are increasingly turning to green energy. This additional demand is driving massive expansion of renewable infrastructure. RE Royalties finances precisely these projects without bearing operational risks, thereby indirectly benefiting from the electricity hunger.
Management has drawn conclusions from the market situation. At the end of March 2026, a formal review of strategic options began, ranging from co-investment partnerships to a complete sale. The process is being supported by PricewaterhouseCoopers. At the same time, additional capital is flowing into US solar projects. In February, the second tranche of USD 800,000 was released for a Solaris Energy portfolio. This brings the total disbursed to date to USD 3.8 million out of a planned USD 9 million. Thanks to its successful business model, the company has paid a strong dividend for many years. It has since switched from quarterly to annual distributions to be able to act more quickly on investment opportunities as they arise.
Global demand for green energy infrastructure is surging. Artificial intelligence, electric mobility, and industrial decarbonization require ever-increasing amounts of electricity, which is increasingly coming from solar and wind sources. RE Royalties has a pipeline of letters of intent totalling approximately CAD 20 million, as well as potential financing projects worth CAD 200 million currently under review. The business model scales exceptionally well: more projects mean more recurring revenue without operating costs rising at the same rate. The outlook remains electrifying. The stock is currently trading at around CAD 0.39.
NextEra Energy: Supplying Green Power for the AI Boom
The Florida-based company sits at the intersection of the energy transition and the AI boom. As the world’s largest operator of wind and solar farms, NextEra Energy is meeting the rising demand for clean electricity. At the same time, the explosive energy hunger of data centers is driving the business. Electricity consumption by these facilities is expected to double by 2030. NextEra already has long-term power purchase agreements with Google and Meta for several gigawatts (GW) in the bag. The project pipeline for renewable capacity stands at 33 GW.
In May 2026, the company announced the acquisition of Dominion Energy. It is to be an all-stock transaction. The result will be the world’s largest regulated electric utility, serving 10 million customers in Florida, Virginia, North Carolina, and South Carolina. Dominion brings with it the coveted “Data Center Alley” in Virginia, where 51 GW of contractually secured AI demand from Amazon and Microsoft awaits. The deal improves the cost of capital and boosts long-term earnings growth to over 9% annually.
The biggest unknown remains regulation. Several states and the FERC must approve the transaction. If the merger fails, a billion-dollar penalty will be due. The first quarter of 2026 was solid. Adjusted earnings per share exceeded expectations at USD 1.09. For investors betting on consolidation in the US energy market, this is an exciting but risky chapter. The dividend continuity over many years is also impressive. Currently, a share costs USD 85.68 and has suffered somewhat so far due to the takeover.
The collision of AI demand and the energy transition is creating a historic demand gap. Siemens Energy is benefiting as a grid infrastructure supplier with record orders, but is struggling with its wind power subsidiary Gamesa. RE Royalties is quietly financing the green expansion via a scalable royalty model while exploring strategic options. NextEra Energy supplies green electricity to tech giants and is making the leap to become the largest regulated utility through the Dominion acquisition. Those who bet on these three different beneficiaries stand to benefit from two trends at once.
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