Britain's National Grid announced on Wednesday, July 1, 2026, an investment of $1.75 billion for a 35% stake in Joulent, a US-based energy platform. This strategic move aims to leverage the rapidly growing electricity demand from AI data centers, which saw a 17% increase in 2025, significantly outpacing the 3% growth in overall global electricity demand. The investment will be funded through National Grid's existing balance sheet capacity and is incremental to its ongoing five-year capital investment program of at least £70 billion through fiscal year 2031. A final investment decision on the Joulent stake is anticipated by the end of 2026.
J.P. Morgan analysts anticipate this investment to yield returns exceeding the 9-10% expected from regulated networks, reflecting a slightly higher risk profile. The deal will specifically finance Joulent's foundational project, known as Kilby. This project, a 2.67-gigawatt gas-fired facility in West Texas, will be developed in a 50/50 partnership with Chevron. It is slated to provide dedicated power to a Microsoft-operated data center campus under a 20-year power purchase agreement. Project Kilby has already secured critical equipment, including GE Vernova turbines, and aims to begin delivering power by 2028.
National Grid expects Joulent to become free cash flow positive in the early 2030s. The strategic partnership is also set to enhance National Grid's existing data center connection program, with plans to connect over 10 gigawatts across the UK and the US within the next five years. Despite the positive outlook from analysts, National Grid's shares experienced a slight decline, falling by 1.4% to trade at 1,230.5 pence by 1142 GMT on the day of the announcement.
