AI in Focus: Natural Gas and Nuclear Energy to Power the Future
Author: Pulkit Sabharwal
September 17, 2026
Artificial intelligence (AI) has been the dominant theme in equity markets throughout 2026. Investors have largely focused on the hyper-scalers and their enormous investments in AI infrastructure. Yet large-cap technology is only part of the story as AI is reshaping industries across sectors.
This edition of AI in Focus puts energy in the spotlight.
There are many questions being asked about artificial intelligence right now. How will companies monetize it? How many jobs will it replace? However, one receiving far less attention is whether the energy system can keep pace with the rapid and widespread construction of AI data centres.
BloombergNEF projects data centre power consumption will hit roughly 106 gigawatts by 2035, which is more than double the level used today. The speed of the ongoing infrastructure buildout and subsequent implementation could push this figure even higher. This will necessitate the use of all energy types across North America, with natural gas and nuclear power likely to be two of the most relied upon sources.
Natural gas already has several things working in its favour, including its scale, reliability, existing infrastructure, and cleanliness compared to coal. It accounts for roughly 43% of power generation in the United States today, which equates to 35 to 40 billion cubic feet per day. That is expected to reach 60 billion cubic feet per day by 2035.
Nuclear power, meanwhile, is an ideal long-term option because of how it can be scaled and its alignment with the current decarbonization goals of Western governments. Nuclear currently supplies roughly 20% of the US’ electricity demand and this market share is expected to remain stable until 2035. This would imply an increase from 800 million megawatt-hours to the 1-to-1.2 billion range in that timeframe.
So, with all that in mind, what opportunities might this present for investors?
Advantaged producers could benefit from higher demand and strong natural gas pricing, while midstream companies are positioned to support the transportation and infrastructure required to bring additional supply to market. On the nuclear power side, advantaged uranium producers are positioned to benefit from elevated demand along with the companies involved in reactor design and construction. The producers with the strongest amounts of reserve life and competitive cost positioning relative to their peers could be especially primed to succeed in the coming years.
Time is a legitimate bottleneck to be aware of, however, especially as it pertains to nuclear power. It can take years to develop a uranium mine and just as long to construct a nuclear reactor. The current US administration has made competitive positioning within this space a priority with this consideration, committing roughly $20 billion USD to reactor development as well as announcing sector-specific production and investment tax credits.
Energy, like AI more broadly, is therefore both a short and long-term investment theme. We believe natural gas and nuclear power will both play critical roles in the AI buildout, with the former likely being relied upon more in the short-to-intermediate future, and the latter potentially becoming an increasingly important contributor in the decades ahead.
The views expressed in this blog are those of the author and do not necessarily represent the opinions of AGF, its subsidiaries or any of its affiliated companies, funds, or investment strategies.
Commentary and data sourced from Bloomberg, Reuters and other news sources unless otherwise noted. The commentaries contained herein are provided as a general source of information based on information available as of September 9, 2026. It is not intended to address the needs, circumstances, and objectives of any specific investor. The content of this commentary is not to be used or construed as investment advice, as an offer to buy or sell any securities, and is not intended to suggest taking or refraining from any course of action. Every effort has been made to ensure accuracy in these commentaries at the time of publication, however, accuracy cannot be guaranteed. Market conditions may change and AGF Investments accepts no responsibility for individual investment decisions arising from the use or reliance on the information contained herein.
This website may contain links to third-party websites. The parties who own, maintain or control third-party websites are solely responsible for their content, and AGF assumes no responsibility for such content. Links to third-party websites are provided for convenience only and are not to be construed as an endorsement or recommendation of the products, services, advice or information that may be available on them.
This document may contain forward-looking information that reflects our current expectations or forecasts of future events. Forward-looking information is inherently subject to, among other things, risks, uncertainties and assumptions that could cause actual results to differ materially from those expressed herein.
For Canadian investors: Commissions, trailing commissions, management fees and expenses all may be associated with investment fund investments. Please read the prospectus before investing. Investment funds are not guaranteed, their values change frequently, and past performance may not be repeated.
AGF Investments is a group of wholly owned subsidiaries of AGF Management Limited, a Canadian reporting issuer. The subsidiaries included in AGF Investments are AGF Investments Inc. (AGFI), AGF Investments LLC (AGFUS) and AGF International Advisors Company Limited (AGFIA). AGFI is registered as a portfolio manager across Canadian securities commissions. AGFUS is a registered investment advisor with the U.S. Securities Exchange Commission. AGFIA is regulated by the Central Bank of Ireland and registered with the Australian Securities & Investments Commission. The term AGF Investments may refer to one or more of these subsidiaries or to all of them jointly. This term is used for convenience and does not precisely describe any of the separate companies, each of which manages its own affairs.
AGF Investments entities only provide investment advisory services or offers investment funds in the jurisdiction where such firm, individuals and/or product is registered or authorized to provide such services. Investment advisory services for U.S. persons are provided by AGFUS.® / TM The “AGF” logo and all associated trademarks are registered trademarks or trademarks of AGF Management Limited and used under license.
RO: 20260911-5911503
About AGF Management Limited
Founded in 1957, AGF Management Limited (AGF) is an independent and globally diverse asset management firm. Our companies deliver excellence in investing in the public and private markets through three business lines: AGF Investments, AGF Capital Partners and AGF Private Wealth.
AGF brings a disciplined approach, focused on incorporating sound, responsible and sustainable corporate practices. The firm’s collective investment expertise, driven by its fundamental, quantitative and private investing capabilities, extends globally to a wide range of clients, from financial advisors and their clients to high-net worth and institutional investors including pension plans, corporate plans, sovereign wealth funds, endowments and foundations.
Headquartered in Toronto, Canada, AGF has investment operations and client servicing teams on the ground in North America and Europe. AGF serves more than 800,000 investors. AGF trades on the Toronto Stock Exchange under the symbol AGF.B.
For further information, please visit AGF.com.
© 2026 AGF Management Limited. All rights reserved.
