NextEra to acquire Dominion Energy for $67 billion: How AI data centers are driving the deal

NextEnergy is all set to buy Dominion Energy in a staggering $67 billion deal. The merger of these power companies, amid the growing demand of power due artificial intelligence, will create one of the biggest power companies in the world.

The energy demand has exploded since the technology giants started building AI data centers which consume massive amounts of electricity.

For years, the electricity use in the United States (U.S.) has remained mostly flat; however, the development of AI data centers has changed that.

Dominion operates heavily in Virginia which has become the data center capital in the country, where the companies Google, Amazon, Microsoft and Meta are racing to dominate AI by building large-scale AI data centers.

NextEra, based in Florida, is one of the world’s largest energy developers and access to Dominion’s portfolio would enable it to expand into the PJM Interconnection region and capitalize opportunities in Virginia.

Under the deal, Dominion shareholders would receive NextEra shares as part of the takeover agreement, while the combined company would control huge amounts of electricity generation across renewables, gas, battery storage and nuclear power.

Investors reacted immediately after the announcement. Dominion shares jumped sharply, while some investors worried about how expensive and massive the deal could become for NextEra.

NextEra CEO John Ketchum said the merger would help America handle rising electricity demand and improve the country’s power infrastructure for the future.

The deal, which according to experts is expected to face tight scrutiny, will close in the next 12 to 18 months. The deal is expected to go through antitrust review, shareholder and regulatory approvals from the Federal Energy Regulatory Commission, Nuclear Regulatory Commission, and state utility regulators in Virginia, North Carolina and South Carolina.