Energy

Why it exists

The economic input is firm electrical service delivered to the site. A utility turns generation, transmission, substations, distribution infrastructure and an executed service agreement into usable megawatts at the meter. Interconnection is the gating condition on that service, not the service itself. A data centre still needs a utility study, a queue position, regulatory approval, transmission that may not exist and generation that may not have been built.

Interconnection queues run four to seven years in many US markets, beyond five in many regions. Berkeley Lab, Queued Up 2026 tracks the queue: about 2,060 GW of generation and storage was actively waiting at the end of 2025, and of everything that entered between 2000 and 2020, 13% had reached commercial operation and 75% had been withdrawn. Grid capacity for existing data centre projects is largely committed through 2030 in most primary US markets. And capacity under construction in the eight primary US markets declined in 2025 for the first time since 2020, on permitting, zoning and power procurement delays.

Relevant businesses

• Load-serving utilities and transmission owners; PJM, ERCOT and MISO coordinate access

Worth understanding

That last item is the most important single data point in this primer. Data centre construction slowed while demand accelerated. That is not a demand signal, and reading it as one inverts the causality.

The interconnection constraint on this delivery path is terminal, not merely severe. Clearing a manufactured node exposes another input or process. Grid interconnection has no manufactured successor that clears the queue. You can buy accelerators you cannot energise.

Why it exists

Entirely because the queue exists. Generate at the site, skip the interconnection.

Roughly 101 GW of on-site natural gas generation has been announced by data centre developers specifically to bypass interconnection bottlenecks. Bloom Energy's product backlog reached about $6bn entering 2026, up more than 2.5x year over year, inside a total backlog near $20bn including services; about $7.65bn of data-centre contracts landed in a single 90-day window in early 2026, and a roughly $5bn arrangement in June 2026 anchored by a $2.65bn agreement with AEP. Bloom Energy, Q2 2026. Manufacturing is expanding toward 2 GW of annual capacity by end-2026, described in trade coverage as necessary but likely insufficient against the signed pipeline.

Relevant businesses

• Bloom Energy
• ProEnergy
• VoltaGrid
• Mainspring
• project developers and operators

Worth understanding

The product being sold is time, not electricity. A hyperscaler with accelerators on order and no interconnection loses revenue per day of delay. On-site generation converts a four-to-seven-year wait into months, which is why the price per kilowatt can sit well above grid power without the customer objecting: the comparison is not against grid power, it is against nothing.

This is a bypass, not a fix. It routes around the terminal node for individual projects without clearing it. 101 GW announced against manufacturing capacity in low single-digit gigawatts per year is a release valve far too small for the pressure — which is simultaneously why the constraint persists and why the suppliers are sold out.

So the analytical question here is throughput, not demand. The contracts have settled demand. Backlog growth of 2.5x against capacity growing toward 2 GW is the arithmetic that decides whether a signed pipeline becomes revenue or becomes a queue of its own.

Why it exists

Getting power to the site is half the problem. The other half is moving it from the building feed to the chip: UPS, busway, distribution, rack conversion, board-level regulation.

Rack power is going from tens of kilowatts to hundreds. NVIDIA's Kyber generation is specified around 600 kW per rack with all-liquid cooling for H2 2027, and the industry is moving to 800 volt DC distribution to serve it. Vertiv, Schneider, Eaton and Delta have commercial 800VDC products slated for the second half of 2026. At 800VDC the same power moves at roughly 1,250 amps, cutting copper use by about 45% and lifting end-to-end efficiency from around 83% to 92% or better. Data Center Dynamics.

Relevant businesses

• Vertiv
• Schneider
• Eaton
• Delta
• Monolithic Power
• Infineon

Worth understanding

An efficiency gain from 83% to 92% is not marginal when power is the binding constraint. It is roughly a tenth more compute from the same interconnection. When the scarce input is megawatts, efficiency at every conversion step converts directly into capacity — which makes this unglamorous node strategically valuable in this cycle specifically, and was not true in any previous one.

Why it exists

Every watt delivered is a watt to remove. Air cooling is finished at these densities; direct-to-chip liquid is the standard for new AI deployments.

Notably unconsolidated by this map's standards — the top seven hold roughly 35% of the liquid cooling market. Cooling distribution unit capacity is now a first-order design parameter rather than a facilities detail, with CDU lines spanning roughly 70 kW to 1.35 MW per unit.

Relevant businesses

• Vertiv
• Schneider/Motivair
• Boyd
• CoolIT
• Modine
• nVent
• AAON

Worth understanding

The scarce resource is not the equipment. It is the people who can design and commission a liquid loop at scale, and that does not respond to capital on any useful timeframe. Which is why this node shares its bedrock with branch 5 — the same skilled trades.

Why it exists

Bypassing the grid queue still requires a physical prime mover: fuel cells, reciprocating engines, turbines or another dispatchable system sized and permitted for the site.

Modular equipment can arrive faster than a utility interconnection, while the largest behind-the-meter projects draw from the same turbine manufacturing base as grid generation. GE Vernova's gas turbine backlog reached 100 GW in Q1 2026, up from 83 GW at end-2025, after signing 21 GW of new agreements and booking $2.4bn of data centre electrification orders in a single quarter. GE Vernova, Q1 2026.

Relevant businesses

• GE Vernova
• Siemens Energy
• Mitsubishi Power
• Caterpillar
• Cummins
• Bloom
• Mainspring

Worth understanding

This node is intentionally scoped to equipment that can serve the on-site path. Grid-scale generation outside the site affects interconnection availability, but it is not routed through this box. The distinction prevents one broad “generation equipment” label from pretending two delivery paths are the same.

Why it exists

Power has to be stepped, switched and carried between generation and load. Transformers, switchgear, breakers, cable.

High-power transformer lead times went from 24-30 months pre-2020 to about five years today. Siemens Energy's grid order backlog hit a record €51bn with transformer orders up 28%, and new transformer and switchgear capacity is spoken for until 2030. Siemens Energy, Q3 FY2026. GE Vernova closed its $5.3bn purchase of the remaining half of Prolec GE in February 2026.

Relevant businesses

• Hitachi Energy
• GE Vernova (Prolec)
• Siemens Energy
• Schneider
• Eaton
• ABB

Worth understanding

A five-year transformer lead time is longer than the AI capex cycle that created the demand. This is the node where the constraint most plainly outlasts the thing constraining it, and where a project timeline can be set by a piece of equipment nobody in the AI conversation ever mentions.

Why it exists

Transformer manufacturing needs grain-oriented electrical steel, large volumes of copper, and skilled winding labour. All three have multi-year lead times of their own and far less attention than anything above them.

Relevant businesses

• Grain-oriented steel mills
• copper miners and refiners
• skilled winders

Worth understanding

This is the floor of branch 4, and it is where the branch touches branch 3 — copper goes into both transformer windings and cable assemblies. A copper squeeze would hit the movement branch and the energy branch simultaneously, which is exactly the kind of correlation a branch-by-branch view is built to miss.