Utilities and investors have shifted their focus towards acquiring existing power plants rather than waiting for new ones to come online, driven by the increasing electricity demand from AI-driven data centers. This trend has intensified due to a variety of challenges including permitting delays, equipment shortages, and interconnection backlogs that extend timelines for new generation projects. According to a Deloitte report, the market is now willing to pay a premium for operational assets that can deliver electricity swiftly.
This premium reflects a trend towards “deliverable capacity,” which refers to the immediate availability of operating generation resources that can address the current demand. As Thomas Keefe from Deloitte points out, the US is experiencing rising power demand as digital infrastructure and electrification expand due to AI, while simultaneous growth in grid infrastructure is lagging due to high costs, regulatory hurdles, and capital constraints.
In 2025, the preference for acquisitions over new constructions became noticeable. Deloitte reported nearly $142 billion in transactions in the power and utilities sector, with an apparent prioritization of operational plants — those with established connections to the grid. Brynna Foley, an analyst at Enverus, notes the surging costs associated with new generation infrastructure, particularly in gas plants, increased by approximately 40% between 2015 and 2025. As such, existing power generation assets have become more appealing to investors.
The value of existing plants is demonstrated by the transaction multiples in 2025, which were markedly higher than in previous years, despite many operational plants trading below the costs of constructing new ones. This has created a “buy-to-build” dynamic favoring acquisitions, particularly in the gas sector, where 62 GW of generation changed hands, amounting to almost 43% of the capacity traded that year.
The emphasis on the rapid energization of power assets is also pushing data center developers to seek generation resources that can be quickly energized and connected. This strategy includes on-site generation and "bring-your-own-generation" models, which aim to mitigate delays caused by congested grids and ensure that hyperscale deployments can proceed without significant interruptions.
As the market dynamics evolve, investor behavior has also seen a shift. The increase in demand for existing assets is notable in regions such as PJM Interconnection and ERCOT, where transactions have recently slowed due to a diminishing supply of high-quality portfolios and large independent producers consolidating their strategies.
In contrast, merchant generators, which benefit directly from market tightness, often take advantage of elevated energy margins and capacity values. On the other hand, regulated utilities operate under different incentives, often scrutinized for acquisition premiums by regulators unless clear benefits to ratepayers can be demonstrated. This can lead utilities to invest more in infrastructure that supports grid reliability rather than directly in generation.
The outlook suggests that ownership of power generation assets will increasingly consolidate among large, well-capitalized enterprises that can deliver rapid and reliable capacity. As AI-induced electrical demands escalate, the intrinsic value of existing generation resources rises — not just for their ability to produce power, but for their capability to deliver it more quickly than new projects can be developed.
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