Defiance AI & Power Infrastructure ETF targets U.S. grid demand from AI expansion

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AI & Power Infrastructure ETF targets grid

Highlights

Morgan Stanley forecasts U.S. data centers will need 97 gigawatts of additional power from 2026–2028, with a projected 32-gigawatt shortfall.
Lead times for high-voltage transformers have extended from 16–24 weeks to three or four years, severely delaying power connections for AI data centers.
The Defiance AI & Power Infrastructure ETF (AIPO) reached $900 million in assets by early October, investing in AI hardware, utilities, and infrastructure with a 0.69% expense ratio.

Power shortage reshapes AI investment focus

As reported by Weiss Ratings, the AI buildout is increasingly colliding with limits in the U.S. electrical grid, creating a potential opening for infrastructure-focused investments such as the Defiance AI & Power Infrastructure ETF. The analysis says companies can secure land, servers and Nvidia GPUs for new facilities, yet still face years of delays before obtaining enough electricity to operate at scale.

Morgan Stanley estimates that U.S. data centers will need 97 gigawatts of additional power from 2026 through 2028. Even after accounting for projects under construction, existing grid capacity and time-to-power options including nuclear, gas turbines and fuel cells, the bank still sees a 32-gigawatt shortfall.

The imbalance reflects a mismatch in build times across the sector. A hyperscaler can complete a standard data center in 18 to 24 months, while new power generation, transmission projects and permitting can take seven to 12 years, and interconnection queues in major markets can last four to seven years.

Equipment delays support infrastructure theme

Beyond power supply itself, the report highlights another constraint in the hardware needed to connect electricity to data centers. Lead times for large high-voltage transformers have stretched from 16 to 24 weeks to three or four years, while switchgear, breakers and substations also face heavy backlogs.

That pressure is pushing developers toward nuclear co-location, natural-gas turbines, microgrids, long-term power agreements and fuel cells. Weiss Ratings points to companies such as Quanta Services, GE Vernova, Eaton, Vertiv and Bloom Energy as potential beneficiaries of that spending cycle.

The Defiance AI & Power Infrastructure ETF, trading under the ticker AIPO, is positioned around that theme through holdings in AI hardware, data centers, utilities, power generation, electrical infrastructure and construction. Its portfolio includes Nvidia and Broadcom, and its assets had grown to about $900 million as of early October, while the fund carries an expense ratio of 0.69%.

Our earlier coverage of Canada’s nearly $270 million clean-energy package for New Brunswick detailed planned upgrades to hydro generation at Mactaquac and grid-stability improvements at the Salisbury Terminal. The piece highlighted how investment in transmission reliability and renewable integration is being positioned as a response to rising power demand and the need for a more resilient electricity system.

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