Weekly Update: BlackRock’s Big Energy Trade
Good evening, and welcome to this week’s edition of Stealth Trades!
Hedge funds are betting big on AI. But they’re not buying Nvidia anymore. Their latest investments have nothing to do with chips at all.
Wall Street funds have shifted their focus. They’re not buying tech startups anymore; they’re buying the power that keeps AI alive.
Blackrock ,Blackstone and dozens of others are going beast mode on utilities.
Now, these companies have, historically, been pretty boring. But not anymore. In fact, they could be some of the biggest winners over the next few years…
BlackRock just acquired Minnesota Power for $6.2 billion.
Blackstone is dropping $11.5 billion on TXNM Energy.
And this is just the tip of the iceberg.
Today I’m going to lay out why energy is Wall Street’s trade of the year. I’m also going to share three stocks you can buy today to get in on the action.
Last year, BlackRock acquired Global Infrastructure Partners (GIP) for $12.5 billion. This expanded the fund’s energy footprint to create a $170 billion dollar infrastructure powerhouse.
GIP now operates as a division of BlackRock, strategically targeting high-growth areas like digital infrastructure, energy, and transportation.
BlackRock didn’t even have the money to buy it. They had to issue 12 million new stock shares to buy it. They diluted their shareholders… that’s how badly they wanted this deal.
They spent $500 million for a 20% equity stake in Recurrent Energy – a cutting-edge solar company spun off from Canadian Solar.
Before that they bought that natural gas giant, Vanguard Renewables – all of it- along with Jupiter Power, Akaysha Energy, and New Zealand-based solarZero.
And that’s just on the renewable side…
Blackrock is buying up utility companies and grid infrastructure hand over fist.
A few months ago, it acquired Allete, which owns Minnesota Power and Wisconsin’s Superior Water, Light & Power for a cool $6 billion.
They teamed up with Morgan Stanley to pick up a stake in Portland’s pipeline business via TC Energy.
Two weeks ago, BlackRock increased its stake in California utility operator, PG&E .
And it continues to add to its holdings in NextEra Energy, ticker NEE, as well. The stock just hit its all-time high.
I haven’t even mentioned their legacy holdings in Exxon, Chevron and Diversified Energy. Or their new partnership with Microsoft set to invest another $30 billion in AI data centers and the energy infrastructure that powers them.
BlackRock is on a buying spree. They’re spending like a teenager who just got her first credit card.
This is Wall Street’s next gold rush. And this time, it’s not apps, chips or data. It’s energy.
Artificial intelligence is seeing rapid adoption. Even if you’re trying not to use it, you probably are. AI is embedded in search engines, trading algorithms, even your smartphone.
But behind the optimistic headlines is a silent emergency. The AI boom is consuming power faster than our electrical grid can possibly keep up.
Today, U.S. data centers consume 5% of all electricity generated. And over the next three years, that number is expected to double.
Data centers are the new factories of this digital age — massive, relentless, and always on. They hum day and night, processing trillions of computations per second.
But there’s just not enough juice.
Every single AI model, every image generation, every chatbot reply — it all burns electricity.
A single AI data center can consume as much power as 150,000 homes. And there are 5,427 of them operating right now, 24/7/365.
Energy isn’t just a line item anymore — it’s a pressure point. And those who control will wield enormous power over the industry.
We taught machines to think… but forgot how to keep the lights on.
So, while amateurs argue over who has the best language model, the real billion-dollar play is who controls the grid.
BlackRock knows it. Blackstone knows it. They’re not chasing the next OpenAI… They’re chasing the power OpenAI needs to survive.
Because AI isn’t just software anymore. It’s infrastructure. And infrastructure runs on electricity.
The AI boom has flipped Wall Street’s logic. Historically, it has invested in innovation. But today, it is investing in what innovation consumes.
Every ChatGPT query, every GPU cluster, every AI-generated image of a cat playing the violin, it all burns megawatts.
The smart money is moving fast. They’re not betting on AI startups. They’re buying the power plants that fuel them.
To put it simply… AI made energy the new gold. And this is just the beginning.
Wall Street is getting in early. Here are 3 stocks being bought heavily by institutional investors.
NextEra Energy (NEE)
NextEra is currently undergoing a strategic transformation from a traditional defensive utility into a critical infrastructure provider for the AI era. The company is leveraging its massive renewable energy backlog and nuclear assets to secure long-term contracts with hyperscalers – including a 25-year power purchase agreement with Google for electricity from its Duane Arnold nuclear plant.
NextEra is also expanding its natural gas assets. Last month, the company increased its stake in Mountain Valley Pipeline.
Its acquisition of Energy Capital Partners is expected to close this quarter, which will expand the company’s customer supply business across 34 states.
Dominion Energy (D)
Dominion is a primary play for AI growth thanks to its position as the power provider for “Data Center Alley” in North Virginia.
The company already has a foothold with the major players and stands to benefit as they continue to expand. Dominion is executing a $50 billion capital investment plan over the next five-years targeting a projected 183% increase in energy demand in the area.
They are also in a $500 million joint venture with Amazon to develop a 300-megawatt modular reactor near the North Anna nuclear plant.
Talon Energy (TLN)
Talon is betting big on nuclear, which many believe will be the future of domestic energy production.
In June, the company expanded its relationship with Amazon Web Services through a new power purchase agreement to provide 1,920 megawatts of carbon-free nuclear power through 2042. That power will be fed straight into Amazon’s data center campus adjacent to Talen’s Susquehanna nuclear plant.
Price hedges ate into its bottom line in 2025. But as these hedges roll off, management expects to collect higher prices on 40% of its production this year and 75% by 2027. Plus, unlike variable renewable sources, Talen’s high-volume generation platform provides the reliable, continuous supply required by data centers.
The AI revolution won’t be won by who codes best, but by who controls the electricity.
It doesn’t matter how good your competitor’s model is. If you control the grid, he can’t run it.
Best wishes for your trading,