North America Power & Utilities: AGA 2026: The Desert Download

Research evidence excerpt

North America Power & Utilities: AGA 2026: The Desert Download

Barclays | North America Power & Utilities

Key Themes

Regulated Large Load Contracting: The Party is Still On; Expect Sector to See Additional

Announcements Into & Ahead of 2Q Results: Among all the companies that have regulated VIU

strategies, it is clear that there deals are being signed across the industry, particularly in the

mid-west, with pace and purpose. We heard positive comments from NI, LNT, WEC, CMS and

DUK in this regard. For WEC, management noted investors could see MSFT announce additional

capacity (we expect another 300-500MWs) and there was higher confidence in delivering on

another DC outside of Vantage / MSFT into the wider 3Q update. We also see the potential for

another NI announcement ahead of 2Q. We also thought it was notable that LNT discussions

noted hyperscalers are starting to take non-firm elections which is accelerating the company's

current large load forecast (11%).

In light of NEE-D merger, most companies pushed back on M&A: Most utilities we met with

do not seem interested in M&A, citing their focus on strong organic growth platforms that

enable them to invest at 1.0x rate base rather than paying an M&A premium. Many also

cautioned about the distraction of M&A and the regulatory scrutiny associated with it and the

length of the approval process. Some of the large cap companies, such as Duke and XEL, said

they believed they already had sufficient scale. That said, NiSource views additional

consolidation as logical across both electric and gas utilities. However, like most others, NI did

note that regulatory approvals can complicate the process.

California SB254 Phase 2 seeing progress, but still limited details and waiting for August: