Industry Overview
Utilities are the largest consumers of natural gas and coal in the economy, with fuel costs representing 40-60% of operating expenses for fossil-fuel generators. Regulated utilities can pass through fuel costs to ratepayers with a lag, but merchant generators bear direct commodity price risk. The sector is undergoing a historic transformation as coal retirements accelerate, natural gas serves as a bridge fuel, and nuclear and renewable capacity expands. AI data center demand is creating unprecedented load growth, reversing decades of flat electricity demand and straining grid infrastructure that requires massive copper and aluminum investment.
Commodity Exposure
Key Companies
Related ETFs
XLU (Utilities Select Sector SPDR)
IDU (iShares U.S. Utilities ETF)