The Grid Rebuild
Ryan Moede@ryan
−1.7%
since Sep 30
The idea
I believe the physical grid, not chips or capital, is the real bottleneck as AI data centers, electrification, and reshoring all demand power at once, and upgrading it is a decade-long spending wave. This basket spreads across the four places that money flows: equipment makers facing multi-year waitlists, regulated utilities approved to spend on their networks, the crews building the lines, and materials like copper. It leans heaviest toward equipment makers, uses utilities as ballast, and keeps a small cash reserve to add on dips, held for years rather than traded around any single catalyst.
What it owns
- The transformers, switchgear, and electrical gear the whole rebuild depends on are in short supply, and these companies make them. · GE VernovaIt makes the large transformers and grid equipment sitting on multi-year waitlists, the sharpest shortage in the take., Eaton CorporationSells the switchgear, breakers, and power management gear that every data center and factory hookup requires, so its electrical backlog signals whether grid scarcity is the binding constraint., HubbellIt makes the connectors, enclosures, and utility components that go into every mile of upgraded line., Powell IndustriesIt builds custom switchgear for data centers, utilities, and industrial sites, riding the plug-in wave directly., nVent ElectricIt makes the enclosures and connection gear that protect electrical equipment, with data centers now a large chunk of sales., American SuperconductorIt sells grid control and resilience tech to utilities, a small bet that a decade of grid spending lifts newer technologies.34%
- Regulated utilities earn a guaranteed return on every dollar spent upgrading their networks, so a decade of grid spending flows straight through them. · NextEra EnergyIt is the largest utility spender on network upgrades, spending tens of billions a year into generation and wires., American Electric PowerIt owns the largest transmission network in the country, the literal wires that become the constraint in the take., SempraIts Texas utility sits where data centers and reshored factories are plugging in fastest, forcing grid spending., EntergyIt serves the Gulf South, where huge data center projects are signing up for power and turning into approved grid spending., Southern CompanyIt is regulated ballast with growing demand across the Southeast as its service territory adds load.24%
- Contractors are stringing wire and building substations with backlogs measured in years. · Quanta ServicesThe largest builder of transmission lines and substations, so its backlog tracks whether the decade-long spending wave on grid infrastructure is materializing., MasTecIts power delivery business strings the lines utilities are approved to build, riding the same wave as larger competitors., MYR GroupIt does almost nothing but electrical construction, making it the purest way to own the crews that build the lines., Primoris ServicesIt builds utility and power infrastructure, including the substations and connections that new load requires.20%
- Every mile of new line needs copper and steel conduit, and supply is the least priced-in part of the story. · Freeport-McMoRanIt is the largest US-listed copper producer, and every mile of new line and every transformer needs copper., AtkoreIt makes the conduit, cable management, and steel tubing that carry wires through every data center and substation., Southern CopperIt mines copper cheaper than almost anyone, so it makes money even if prices wobble and makes more if grid buildout keeps copper tight.14%
- Cash8%