The world’s hunger for energy is showing no signs of slowing. Here’s how to profit
This investment trust has outperformed markets despite the weak sentiment of its sector
There has been a renewed growth in demand for energy in developed markets, reversing a multi-decade trend where this had been offset by energy saving initiatives.
In 2024, investors cottoned onto the vast power requirements of the data centres being built to support the explosive growth of artificial intelligence (AI).
AI chips use more power than conventional ones, and even with the slight setback earlier this year when the success of China’s DeepSeek suggested that AI could be less power hungry than had been predicted, AI-related demand for power is still growing.
The shift towards electric vehicles is progressing faster in some markets than others (in China, for example, over half of new cars sold in May 2025 were hybrids or electric), but again the trend is towards additional demand for power. Similarly, efforts being made to decarbonise domestic heating and industry are another source of demand.
Meeting the additional demand for power means investing in generation, but this takes time and is putting upward pressure on power prices. This also means that additional investment is needed to expand the capacity on badly constrained electricity grids.
In many countries, there is also recognition of the need to tackle a backlog in infrastructure investment. The steps that Germany is taking to unlock hundreds of billions of funds for areas such as transport, education, hospitals and energy projects illustrate that.
There are vast sums of private capital ready to be deployed, too. The likes of KKR, Brookfield, Macquarie, Blackstone and BlackRock have raised more than $100bn (£740m)of fresh capital over the past year.
One probable beneficiary is the Ecofin Global Utilities and Infrastructure investment trust, which was last discussed here back in August 2019. Clearly, a lot of water has passed under the bridge since then, but the trust remains a good way for investors to access this asset class.
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