Artificial intelligence (AI) is a powerful tool poised to change the world in significant ways. However, AI relies heavily on hardware, which requires substantial housing and power infrastructure. Utilities may struggle to keep pace with these demands, but Bloom Energy is prepared to fill this gap.
AI’s Power Requirements
AI systems are essentially high-end computers operating sophisticated software. These computers, housed in data centers, demand significant electricity for both operation and cooling. Without enough electricity, establishing an AI data center is impossible, posing a challenge for the industry.
Electricity demand from AI is expected to increase by 300% over the next decade. This growth presents an opportunity for electric utilities but comes with challenges. AI companies need rapid deployment of processing power, while utilities face prolonged processes to obtain government approvals and construct power facilities. Despite anticipated long-term growth, utilities face pressure to meet demand swiftly.
Bloom Energy’s Immediate Solution
While utilities anticipate long-term growth, AI companies need power solutions now. Bloom Energy offers a rapid power supply solution through hydrogen fuel cells, which can be manufactured and deployed quickly. Data centers can start operations with Bloom Energy cells, which can later be relocated when traditional infrastructure is established. Bloom Energy began 2025 with a $2.5 billion product backlog and an even larger $9 billion service backlog, indicating strong demand for its products and services.
Recently, Bloom Energy signed an agreement with American Electric Power to provide 100 megawatts of fuel cells over the next decade, addressing the anticipated data center demand. This arrangement signifies immediate action and long-term benefits through ongoing service contracts. Negotiations with other utilities are also underway.
Approaching Sustainable Profits
While Bloom Energy is not yet sustainably profitable due to its emerging status in the power sector, it presents an intriguing opportunity for aggressive investors. The company is strategically positioned to supply the growing AI industry with necessary power solutions, potentially accelerating its journey toward sustainable profitability.
