Tech stocks have been a big story over the past year. Many are benefiting from monster AI tailwinds as demand for tech-related hardware, such as chips, accelerates. As a result, many investors have piled into the tech sector, overallocating their portfolios to the industry.
With many tech companies trading at a premium valuation these days, investors might want to forget about the sector until prices come down. However, they can still benefit from AI-driven tailwinds in other sectors, such as energy. Brookfield Renewable (BEPC 0.78%)(BEP 1.00%) is an energy stock with monster AI-powered growth in 2026 and beyond.
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The power play
AI data centers require a massive amount of electricity to run the tech hardware at full capacity and power the cooling systems that prevent it from overheating. That's powering robust demand for clean energy.
Brookfield Renewable is a leader in operating and developing renewable energy generation capacity. Its global portfolio spans hydro, wind, solar, and battery storage. Additionally, it has investments in sustainable solutions, including nuclear energy services.
NYSE: BEPC
Key Data Points
The power partner of the tech titans
Brookfield's global scale and expertise have made it the ideal partner for technology companies seeking power for their data centers. For example, Brookfield signed a global renewable energy framework agreement with Microsoft in 2024 to deliver over 10.5 gigawatts of power across the U.S. and Europe to support its cloud and AI operations. That was eight times the size of the largest single corporate power purchase agreement (PPA) ever signed. Brookfield expects to begin delivering capacity under this PPA in 2026, with deliveries continuing through 2030.
The company also signed the world's largest hydroelectric framework agreement with Google last year, covering up to 3 GW. The first two 20-year PPAs under this agreement represent over $3 billion in revenue and 670 megawatts of capacity in Pennsylvania. Those PPAs support Google's plans to invest $25 billion into data centers across PA and neighboring states within the next two years.
These power deals are likely only the beginning. Given its scale, expertise, and global operations, Brookfield is in a strong positioned to continue capitalizing on AI power demand in 2026.
Powerful total returns ahead
Brookfield Renewable expects to invest $10 billion over the next five years to support development projects, such as those it's building for Microsoft, and acquisitions to further enhance its scale and capabilities. These investments, along with rising inflation-linked power prices under existing PPAs and higher rates on new PPAs, such as those with Google, will support strong earnings growth. Brookfield expects to grow its funds from operations per share at a rate of more than 10% annually through 2030. That should support annual dividend increases of 5% to 9% on its nearly 4%-yielding payout. This growth and income combination could give Brookfield Renewable the power to produce total annual returns in the mid-teens in 2026 and beyond.
