Entergy CEO says returns rising as data center demand boosts 2026 plan

Entergy Chair and Chief Executive Officer Drew Marsh said the utility's returns have been "a lot higher than in the past," driven by surging electricity demand from AI data centers that is reshaping the US utility sector.

"We produce steady predictable returns, but they have been a lot higher than in the past," Marsh said on CNBC's "Mad Money" on June 9.

The New Orleans-based utility recently unveiled a capital plan tied to data center expansion, though specific figures were not yet disclosed. Marsh pushed back on concerns that AI-driven demand would drive up electricity bills for residential customers, arguing that the company's regulated model protects consumers while allowing Entergy to capture growth from hyperscaler contracts.

Entergy is among a growing list of US utilities benefiting from demand as technology companies including Amazon, Microsoft and Alphabet race to build AI infrastructure. The company's regulated utility model provides a stable earnings base while data center load growth offers an incremental revenue driver that has attracted increased investor attention to the sector.

The utility sector has drawn renewed interest from institutional investors as AI infrastructure buildout drives electricity demand growth not seen in decades. Entergy, which serves customers in Arkansas, Louisiana, Mississippi and Texas, is positioned to capture a share of that demand through its regulated operations. The company's service territory includes regions with significant data center development activity.

The comments signal that management expects AI demand to accelerate utility investment. Investors will watch for further details on the capital plan and regulatory approvals in the coming quarters, with the company expected to provide more specifics on its growth trajectory.

This article is for informational purposes only and does not constitute investment advice.