Powering the intense energy needs of artificial intelligence (AI) is not as simple as relying on just one power source. Instead, many companies are building energy portfolios with multiple resources to meet varying needs. That includes everything from natural gas to solar to battery storage and more to meet current and future demand.
The companies offering that type of diversified energy portfolio are Enbridge (ENB +3.74%), Duke Energy (DUK +2.40%), and NextEra Energy (NEE +3.99%). Let's look at how these three stocks could power your portfolio into the future.
Image source: Getty Images.
Finding winners to fulfill growing energy demands
Some companies have traditional energy operations, while others are strictly focused on building out alternative energy resources. According to Motley Fool research, it may be better for investors to focus on total energy demand.
"Investors should focus more on total energy demand than on renewables versus fossil fuels in the energy mix," the report says, "Over the long term, solar, wind, battery energy storage, and nuclear will likely make up a higher proportion of the electricity mix than natural gas and coal. However, natural gas consumption could still be far higher 5 to 10 years from now than today, given AI's outsize energy demands."
Having a diversified energy portfolio helps meet more clients' needs, but it also can serve as a shield against risk. If sales in one business segment start to slow, that can be offset by the revenue from other segments.
Total energy stocks to consider
For this list of stocks to consider, I'll start with two companies that may be a better fit for investors seeking income and who are more risk-averse.
The first is Enbridge, which has a huge natural gas foothold across North America. It's the largest natural gas distribution company in Canada, and 90% of Utah's population gets its natural gas from Enbridge. Its natural gas pipeline makes it a natural candidate to serve data centers, but it also has a deal with Meta Platforms on a solar project in Texas. In terms of stability, Enbridge has increased its dividend payout for 31 consecutive years, and that dividend currently yields 5.3%.
NYSE: ENB
Key Data Points
The second company, Duke Energy, has a vast energy portfolio and operations that range from nuclear energy to capturing landfill methane and turning it into fuel. Across North and South Carolina, it runs 11 nuclear energy units. It is also involved in battery storage systems that supplement solar energy when solar is not available. Duke is a consistent dividend payer, with 100 straight years of payouts, and its dividend currently yields 3.3%.
NYSE: DUK
Key Data Points
The third company is a bit more of an aggressive investment, but in terms of stock price appreciation, the risk comes with potential rewards. NextEra runs a regulated utility subsidiary, Florida Power & Light, but it also has seven nuclear units in operation, and signed a 25-year agreement with Alphabet in 2025 to fulfill the tech giant's power needs through a nuclear reactor in Iowa.
NYSE: NEE
Key Data Points
NextEra also has business segments in energy storage and gas generation. Its stock has performed best of the three over the last year, but it's also often valued more as a pure alternative energy company, whipping the stock price around. Despite that, NextEra still regularly pays a dividend, currently yielding 2.6%.
