The privatization of a major Midwest utility is becoming a real-world test of the Trump administration’s belief that private investment—not the federal government—will spur the next generation of U.S. grid investment.

AES Corp. shareholders overwhelmingly approved the company’s $33.4 billion take-private acquisition by a consortium led by Global Infrastructure Partners, a part of BlackRock, and EQT Infrastructure VI last week.

Executives pushed for the agreement because they thought AES could not finance its growth plans without outside capital. The company said that, without the deal, funding future growth investments would likely require reducing or eliminating its dividend, issuing significant new equity, or both.

The purchase price will be funded with 100 percent equity, adding no new debt to AES. The buyers have also said transaction costs and acquisition premiums will not be passed on to customers.

The private capital rush into power infrastructure is being driven by the same trend reshaping energy markets nationwide: AI and data centers need enormous amounts of reliable electricity, and they need it quickly.

The U.S. Energy Information Administration projects power consumption will hit record highs in 2026 and 2027, with demand from artificial intelligence and data centers helping drive growth.

That growth is putting new strain on America’s energy grid.

The Electric Power Research Institute’s 2026 “Powering Intelligence” report projected data centers could use 9 percent to 17 percent of U.S. electricity by 2030, up from 4 percent to 5 percent today. EPRI described data centers as the fastest-growing source of electric demand in the country.

In some cases, the private capital math may cut in customers’ favor. Research has suggested that large new electricity loads can reduce average prices when fixed utility costs are spread across a larger customer base. Analysts also caution that the benefits depend on whether the grid can keep up. If new demand outpaces generation and transmission, customers could face higher costs.

Private investment in U.S.-based AI, data centers and energy infrastructure is expected to grow. Last year, OpenAI and SoftBank announced the $500 billion Stargate Project, intended to create more than 100,000 jobs in the United States. The White House has promised to expedite permitting for energy infrastructure tied to the buildout.

Supporters see the AES agreement with GIP and EQT as an example of how the private sector will play a key role in the future of energy.

“Washington cannot simply finance growth of this magnitude long-term,” said Guy F. Caruso, senior adviser for the Energy Security and Climate Change Program at the Center for Strategic and International Studies.

Caruso, a former administrator of the EIA, said private capital demands a return on investment.

“The overwhelming support shown in the AES shareholder vote validates that private infrastructure investors can help deliver the grid upgrades needed for AI leadership and affordability,” Caruso said.

Former Interior Secretary David Bernhardt made a similar argument in the Washington Examiner, writing that projects like AES will need flexibility to build modern generation and transmission. All the government needs to do, according to Bernhardt, is get out of the way.

“Policymakers do not need to pick winners and losers,” Bernhardt wrote. “They need to make sure capital can flow to projects that strengthen reliability and serve American consumers, with transparent pricing, clear market signals, and a regulatory environment that does not punish the partners willing to put real money at real risk.”

The AES transaction still needs regulatory approval from federal, state and foreign authorities, including energy regulators. AES and the consortium expect the deal to close in late 2026 or early 2027.

Caruso said more permitting reform is needed if policymakers want other technology and energy projects to get off the ground.

“Private capital demands certainty,” he said. “If policymakers want investors to fund decades of new generation, transmission and reliability assets, they must deliver on timely permitting, predictable regulation and market rules that reward dependable power.”

Taylor Millard writes about politics and public policy for InsideSources.com.