As we exit 2025 and enter 2026, one of the ongoing investment themes is energy. The reason is the growing data center buildout to accommodate increasing demand for artificial intelligence (AI). The new data centers are power-hungry, and their appetite has put domestic energy at the forefront.
As a result, upstart energy companies have seen their share prices surge. Two companies that have taken the industry by storm this year are Bloom Energy (BE +1.86%) and Oklo (OKLO 3.98%). The two companies have benefited mightily from these positive developments, and their stocks have surged 285% and 252% year to date, respectively.
While Bloom Energy and Oklo are both benefiting from the energy narrative's tailwinds, one stock is a better buy as we enter 2026. Let's determine which one.
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Energy demand is growing
The data center buildout in the United States will require a significant amount of energy. That's according to Goldman Sachs, which projects that data center electricity use in the U.S. will rise from 3% of total demand in 2022 to 8% by 2030. It's not just data centers, though. Goldman sees strong growth in transportation, industrial, and residential usage driving energy demand.
The Bank of America Institute projects that energy demand will increase by 2.5% over the next decade. This growth rate is 5 times that of the previous decade. Goldman Sachs estimates that roughly $720 billion in global grid upgrades will be needed by 2030 to prevent bottlenecks.
Meanwhile, hyperscalers such as Microsoft, Alphabet, and Amazon prefer renewable energy, and the need for reliable power is driving a resurgence in nuclear energy and increased reliance on natural gas. This is why upstart companies in the space, like Oklo and Bloom, are surging.
Bloom Energy's fuel cells are seeing a pickup in demand
Bloom Energy specializes in designing and manufacturing solid oxide fuel cell systems. Its Bloom Energy Servers use solid-oxide technology to convert fuels such as natural gas, biogas, and hydrogen via an electrochemical process without combustion. These servers can be clustered to generate on-site electricity for commercial, industrial, or data center applications.
NYSE: BE
Key Data Points
What makes its servers appealing is that these systems are ready to deploy today. Bloom can install them in under 50 days, enabling quick response to growing energy needs while complementing grid-supplied energy. These servers can also operate independently, eliminating dependence on the grid.
In July, Bloom Energy entered an agreement with Oracle to deploy its fuel cell technology to power selected Oracle Cloud Infrastructure (OCI) data centers in the U.S. Then, in October, it entered into a strategic partnership with Brookfield Asset Management to deploy its fuel cells across Brookfield's global AI data center portfolio in a deal valued at up to $5 billion.
Oklo's technology is still a few years away from commercial deployment
Oklo develops advanced fission power plants known as Aurora powerhouses, but does not currently have a commercially operating business. Instead, it is investing heavily in research and development, obtaining Nuclear Regulatory Commission certifications, and securing customers for its next-generation nuclear plant technology.
NYSE: OKLO
Key Data Points
Its Aurora powerhouses use metal-fueled fast-reactor technology based on the Experimental Breeder Reactor-II, which operated for 30 years at the Argonne National Laboratory until it was shut down in 1994. These reactors can run on recycled fuel, with the Aurora powerhouse designed to operate for over 10 years before refueling.
Oklo's Aurora powerhouses could address the biggest hurdle to AI expansion: the power grid connection gap. There is a growing mismatch between the speed at which data centers require power and the pace at which utilities can approve and build new grid connections to supply it.
Like Bloom's servers, its powerhouses could help meet energy needs quickly. However, the company doesn't expect its first commercial powerhouse to come online until 2027 or 2028.
The better stock to buy today
Oklo has its work cut out for it and won't be earning meaningful revenue until 2028 at the earliest. Its powerhouses are promising advanced nuclear technology that could help address future energy demand. Still, they won't be operational for a few years, leaving investors vulnerable to significant price swings at this early stage of the business.
Bloom Energy, on the other hand, has a product ready today that is quick to deploy and can generate meaningful revenue. The stock is expensive, trading at 87.5 times next year's earnings and 34.5 times projected 2027 earnings. But analysts covering the stock project revenue of $1.9 billion this year, with another 30% increase next year to nearly $2.5 billion. Given its near-term earnings upside, Bloom Energy is a better stock to own as we head into the new year.
