Utilities & Renewables 1Q26 wrap: capex supercycle opportunity

Research evidence excerpt

Utilities & Renewables 1Q26 wrap: capex supercycle opportunity

26 May 2026

Utilities & Renewables EquitiesMulti-Utilities

1Q26 wrap: capex supercycle opportunity Europe

◆ Positive outlook on grid capex supercycle, renewables Meike Becker*

re-acceleration, AIDC and energy independence demand Senior Global Utilities & Renewables Analyst HSBC Bank plc

meike.becker@hsbc.com

◆ We retain our preference for high-growth electric grids, +44 20 7991 6441

leading renewables platforms, and US tailwinds Charles Swabey*

Global Utilities & Renewables Analyst

HSBC Bank plc

◆ Buy rated: E.ON, Terna, National Grid, SSE, NextEra, EDP, charles.swabey@hsbc.com

EDPR, Iberdrola, Veolia, Ørsted, RWE +44 20 3268 3954

Chandrahasan S*

Associate

FTSE EU Utilities Index increased c12% in 1Q26, outperforming the broader market Bangalore

by c13%, but momentum faded in Apr/May (utilities -c1% vs market +c5%). We retain

a positive outlook. The investment case is underpinned by rapidly rising electricity * Employed by a non-US affiliate of HSBC Securities (USA) Inc, and is

not registered/ qualified pursuant to FINRA regulations

network investment in a broadly favourable regulatory environment alongside an

improving renewables market and new storage boom. Demand growth is

strengthening, led by data centres and broader electrification, while Europe’s energy

independence agenda reinforces commitment to ‘green’ investment. We think strong

structural growth in a grid capex supercycle coupled with the recent pullback makes

the sector attractive.

Our preference remains for high-growth electricity networks, strong renewables

platforms and US exposure. We maintain Buy ratings on E.ON, Terna, National Grid,

SSE, NextEra, EDP, EDPR, Iberdrola, Veolia, Ørsted and RWE, and Hold ratings on