Beyond the chip: AI infrastructure investment opportunities powering the digital revolution

The infrastructure behind the AI revolution

The AI boom extends far beyond algorithms and neural networks. Behind every breakthrough lies vast infrastructure requirements. OpenAI and Nvidia's strategic partnership, announced on 22 September, demonstrates the scale involved.

The partnership will deploy 10 gigawatts of computing capacity - equivalent to 4-5 million graphics processing units according to Nvidia CEO Jensen Huang. This power capacity could supply over 8 million households based on average US annual electricity consumption.

Such computing power requires three critical infrastructure elements. First, electricity generation must expand dramatically to satisfy data centre demand. Second, sophisticated cooling systems become essential as AI chips generate tremendous heat. Traditional air cooling cannot handle modern AI cluster power densities, driving demand for liquid cooling solutions and specialised heating, ventilation, and air conditioning (HVAC) systems. Third, purpose-built data centres provide the physical housing, requiring reinforced floors and reliable connectivity.

Power utilities capture the electricity demand surge

While the utilities sector traditionally lags the broader market as a defensive, slow-growing investment, AI infrastructure demand has created notable bright spots within this historically steady sector. According to Deloitte's 2025 AI Infrastructure Survey, power demand from AI data centres is expected to grow more than 30-fold by 2035 to 123 gigawatts.

NRG Energy, Constellation Energy, and Vistra rank amongst the top 30 S&P 500 performers year-to-date, benefiting from the AI boom.

Constellation Energy represents the largest nuclear operator in the US, controlling nearly 90% nuclear generation. The company secured landmark 20-year power agreements with Microsoft and Meta to support their expanding AI facilities' power requirements.

NRG Energy operates natural gas, coal, and renewable power generation. The Houston-based company has partnered with GE Vernova to build 5.4 gigawatts of natural gas plants specifically for data centres. Texas-based Vistra also maintains a diverse power portfolio, operating the US's second-largest nuclear fleet.

Other beneficiaries include enablers of electricity expansion, such as GE Vernova, which provides high-efficiency gas turbines to utilities for data centre power projects. The company's stock gained over 380% since its April 2024 General Electric spinoff, reflecting strong demand for power generation equipment as utilities race to meet AI infrastructure requirements.

However, some utilities face challenges, lacking sufficient capital for necessary grid upgrades.

Figure 1: Illustration of infrastructure facilities at a data centre

Data centre REITs house the digital infrastructure

Real estate investment trusts (REIT) owning data centre infrastructure offer another investment approach. They provide exposure to the AI ecosystem without betting on individual technology winners. These REITs benefit from recurring revenue models through long-term contracts spanning multiple years.

Key players include Equinix, Digital Realty Trust, and American Tower, which own specialised facilities where AI systems operate, featuring sophisticated cooling, security, and reliable connectivity requirements.

Some exchange-traded funds (ETF) such as the Global X Data Center & Digital Infrastructure ETF provides diversified exposure to data centre REITs for investors preferring fund-based approaches over individual stock selection.

However, data centre REITs face risks including rapid technological change rendering facilities outdated and substantial capital requirements for upgrades. Rising interest rates pressure REIT valuations through higher borrowing costs and alternative yield competition.

Cooling systems and infrastructure technology benefit

Liquid cooling becomes essential as AI clusters push power densities beyond traditional limits. Vertiv and Schneider Electric are leaders in the space to provide cooling technologies preventing AI data centres from overheating.

HVAC specialists like Comfort Systems USA benefit from data centre construction requirements. These facilities demand precise temperature and humidity control, redundant systems, and continuous reliability, creating niche specialisation that commands higher margins than standard commercial projects.

The challenge lies in construction spending's cyclical nature and potential oversupply if AI demand proves less durable than expected. Companies with diversified end markets should prove more resilient than pure-play AI infrastructure specialists.

How to approach AI infrastructure opportunities

The AI revolution represents more than software innovation as it demands complete infrastructure transformation. Investors positioning through utilities, REITs, and industrial specialists may capture the AI boom's benefits without picking winning technologies, whilst participating at potentially less extreme valuations than direct AI plays.

Risk considerations include technological disruption, interest rate sensitivity for REITs, and regulatory changes affecting utilities. Cyclical construction spending creates volatility for infrastructure specialists.

Multiple investment approaches provide access to these opportunities. Direct stock investment offers concentrated exposure whilst sector ETFs provide broader thematic exposure without single-stock concentration risk.