The demand for AI data centers is growing too fast. This is a Bloom Energy opportunity.

Artificial intelligence (AI) is a powerful tool that will likely change the world in interesting, if not incredible, ways. But AI does not exist in a vacuum. Supports the hardware it needs to accommodate and power. The infrastructure building that does both things will be huge, and one particular department will be difficult to keep up: utilities. but Blooming energy (NYSE:BE) Ready to enter the gap. This is what you need to know.

Artificial intelligence systems are basically just high-end computers running powerful software. These computers (servers) are located in data centers and require the lifeblood of electricity so that they can power them and stay calm. If you don't have a lot of power for these needs, you can't have an AI data center. This has caused problems for the AI ​​industry.

Image source: Getty Images.

The demand for electricity for AI is expected to grow by 300% over the next decade. Of course, this growth will be a boon for power companies. But the problem must be solved because AI companies want to deploy new processing power as soon as possible, and utilities have to do a lot of work to provide the power they need. It is worth noting that regulated utilities must first obtain government permission to spend money on new power plants, lines and infrastructure, and then actually have to build them. It all takes a lot of time.

So the benefit of all this for utilities could be a decade of strong growth. In fact, many utilities management teams are happy to talk about the step changes in the power demand that are happening now. The longer-term demand is expected to come from a shift to wider use of electric vehicles: From now until 2050, electric vehicles are expected to absorb 9,000%. This is a longer, more manageable timeframe for the utility, but it increases the need for speed.

There are obvious opportunities for long-term growth for utility companies, but what should the company do if AI companies need more power now? Bloom Energy can greatly increase the speed at which companies can get electricity. This is because Bloom Energy allows hydrogen fuel cells to be built in the factory and can be easily placed anywhere you need.

Essentially, data centers can be built using Bloom Energy Power batteries and hit the ground to run. When the utility finally arrives to establish a durable energy infrastructure to provide power to the facility, these power batteries can be moved to another site that requires additional current. Bloom Energy started in 2025 with a product backlog of $2.5 billion, so it is in high demand. But each power battery it builds also generates a service contract, which is why it has a larger $9 billion service backlog.

It is worth noting that it has recently been American Electric Power (NASDAQ: AEP) In the next decade, fuel cells worth 100 megawatts will be provided. The protocol is specifically designed to help support AEP's expected data center requirements. In other words, it's all happening, but the benefits of Bloom Energy will be long-term due to the service contracts generated by its product sales. It is negotiating deals with other utilities.

The biggest problem with Bloom Energy is that it remains the top spot in the power sector and has not yet reached the point of sustainable profitability. For these reasons, conservative investors may want to pass the stock pass. But for more aggressive investors, Bloom Energy seems perfect for providing timely (rights) demand (power) to an evolving industry (AI). This should help accelerate the thriving energy and move towards more sustainable profits.

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Reuben Gregg Brewer has no position in any of the stocks mentioned. Motley fool has no position in any stock mentioned. Motley Fool has a disclosure policy.

The demand for AI data centers is growing too fast. This is a Bloom Energy opportunity. Originally published by Motley Fool