If you watched President Trump’s speech on Tuesday night, you watched a new record get set… for the longest State of the Union address ever given.

At one hour and 48 minutes, it broke the last record (also set by Trump, in 2025) by nine whole minutes. That means President Bill Clinton now holds the third and fourth spots at about 89 and 85 minutes, respectively.

(In case you’re wondering, the shortest address was given by Richard Nixon in 1972. It clocked in at a brisk 29 minutes.)

Trump sure knows how to talk… and he had a lot to say.

But within the nearly-two-hour speech, this bit caught my ear:

Many Americans are also concerned that energy demand from AI data centers could unfairly drive up their electric utility bills. Tonight, I’m pleased to announce that I have negotiated the new “ratepayer protection pledge.” You know what that is? We’re telling the major tech companies that they have the obligation to provide for their own power needs. They can build their own power plants as part of their factory so that no one’s prices will go up. And in many cases, prices of electricity will go down for the community – and very substantially down.

The country’s current power grid is too old, he pointed out, and it can’t handle our growing electricity needs. So, his solution is to tell Big Tech to step up in a big way.

Many were surprised by this, but it makes perfect sense…

The AI Backlash

Under President Trump’s proposal – which he says is already well in the works – major technology companies will have to provide for the full cost of power their expanding AI deployment requires. They won’t be able to just rely on existing utilities to handle the added energy demands.

Our current grid capabilities simply can’t handle our growing energy needs – even without AI. Therefore, every added drop of demand adds pressure on existing utilities to expand.

Expansion requires investment. Investments must be paid for somehow. And that “somehow” is almost always at the customer’s expense.

As you may recall, I touched on this last week in an article titled, “An Open Letter to My Fellow Spartanburgers.” In it, I explained how “there’s a growing backlash against artificial intelligence… data centers from local communities” like my hometown of Spartanburg, South Carolina.

Of course, Big Tech must first agree with Trump’s “ratepayer protection pledge” idea. Microsoft (MSFT), it should be noted, has already launched a Community-First AI Infrastructure initiative. And this does, indeed, involve paying for added electricity needs in the communities it affects and otherwise working with local utilities to leave residential electricity rates untouched.

This includes long-term power contracts and funding grid upgrades necessary for their facilities.

I haven’t heard of Amazon (AMZN), Alphabet (GOOG), Meta Platforms (META), or other Big Tech players making similar pledges. But perhaps they’ve been negotiating with the White House behind the scenes as Trump indicated. Or perhaps Trump was trying to force their hand by bringing up the issue.

Regardless, if large AI developers start fully covering their electricity costs… even funding grid upgrades or building dedicated generation… the impact on data-center real estate investment trusts (“REITs”) could be meaningful.

Who Wins Here?

Data-center REITs like Equinix (EQIX), Digital Realty (DLR), and Iron Mountain (IRM) typically lease out powered shelf space or fully built facilities that provide access to power, cooling, and fiber connectivity. These leases tend to be structured for five to 15 years, and they often pass through electricity costs to tenants.

So power isn’t usually a REIT’s margin driver. However, the availability and pricing of power are critical to leasing growth.

If utilities tighten cost recovery, REITs with existing secured power capacity become more valuable, and sites with pre-approved interconnection rights gain scarcity value.

Take Digital Realty, which has enough land available to double its current IT capacity. With around 1,700 megawatts (“MW”) of existing capacity in the Americas, it has a buildable capacity of 2,800 MW and total capacity of 4,500 MW.

Globally, its future development capacity is over 4 gigawatts (GW).

If its Big Tech clients build their own natural gas plants, nuclear partnerships, and renewable storage systems… we could see more “behind-the-meter” generation. It’s very possible that some REITs might even partner with tenants on energy infrastructure.

Another company that could benefit from Trump’s data-center initiative is HA Sustainable Infrastructure Capital (HASI), a Wide Moat Confidential recommendation that has returned 36% since August 2025. It provides capital for projects and companies in the sustainable infrastructure and energy transition spaces.

So, it might be about to see increased interest from here.

Brookfield Infrastructure Partners (BIP) also sits in an interesting position. It owns and operates long-lived, regulated or contracted infrastructure assets across utilities, energy midstream, transport, data infrastructure, and data centers – essentially making it a global owner of critical infrastructure with long-duration cash flows.

Regulated utilities could also benefit, especially names like NextEra Energy (NEE), Dominion Energy (D), and Duke Energy (DUK). These companies operate in data-center-heavy states such as Virginia, Texas, and Arizona, where utilities are already expanding transmission for Big Tech clients.

Meanwhile, natural gas and midstream operators like Kinder Morgan (KMI), Enbridge (ENB), and Williams Companies (WMB) are the backbone of flexible power generation. So, they could see increased business as well.

Remember that AI doesn’t just consume power, it consumes bandwidth. As such, cell-tower REITs like American Tower (AMT) and Crown Castle (CCI) should be considered as well.

And then there are “nuclear options” such as Constellation Energy (CEG) and Cameco (CCJ). Nuclear power provides continuous baseload generation, zero direct carbon emissions, and a decades-long operating life – and it’s something Trump is already pushing.

Reuters reports that the White House expects to host companies in early March to formalize the president’s efforts. However this plan plays out, it’s going to involve a whole lot of companies doing a whole lot of work and investing a whole lot of money.

Our goal is to pinpoint where that money will pay off.

Regards,

Brad Thomas

Editor, Wide Moat Daily