XEL stable growth and favorable regulation

What happened: Google is funding the entire infrastructure for a 750 MW data center campus in Minnesota, served by Xcel Energy (XEL), saving local ratepayers up to $1.5 billion over 15 years. Xcel has raised its five-year capital plan by 33% to $60 billion, with a heavy focus on transmission and renewables, aligning with this data center trend. Xcel, a Minneapolis-based electric and natural gas utility, has shown good long-term EPS growth prospects compared to peers, according to an Argus analyst report.

Market impact: This narrative drives growth and stability in Xcel's regulated operations, benefiting from favorable regulation and stable growth. The deal with Google boosts Xcel's capital expenditure plans, pushing its focus towards transmission and renewable energy infrastructure. This trend positively impacts utilities and renewable energy sectors, as data centers increasingly rely on clean, reliable power.

What to watch next: Xcel's next earnings release, scheduled for July 28, 2026, will provide insights into the financial impact of the Google data center deal. Additionally, regulatory decisions regarding Xcel's rate cases and transmission projects in 2026 will determine the company's ability to pass through costs and maintain its stable growth trajectory. Lastly, keep an eye on Xcel's capital expenditure plans and their alignment with the growing demand for renewable energy and data center infrastructure.