Berkshire Hathaway targets AI gains through power supply and Alphabet stake

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Berkshire targets AI through power, Alphabet

Highlights

Berkshire Hathaway made a $10 billion direct purchase of Alphabet shares this spring at a 6.5% discount as Alphabet raised AI infrastructure capital.
Berkshire Hathaway Energy targets supplying electricity to AI data centers, contingent on not raising rates for existing utility customers, amid power constraints for hyperscalers.
Abel signals Berkshire will continue yen-denominated bond issuances to fund Japanese investments, noting local interest rates remain modest even as the 10-year yield surpassed 3%.

AI strategy spans utilities and equity investment

As reported by CNBC, Abel says Berkshire Hathaway is focusing on two ways to benefit from AI, supplying electricity to data centers through Berkshire Hathaway Energy and building its investment in Alphabet. He says the energy opportunity is significant because one of the biggest constraints on AI data center expansion is securing enough power for the facilities.

Abel says Berkshire will only provide power to hyperscalers if doing so has no effect on rates paid by its other customers. He adds that Berkshire’s operating businesses helped convince him and Warren Buffett that AI is set to have a significant effect on U.S. companies, supporting the decision to build a stake in Google’s parent.

He also describes how Berkshire made a $10 billion direct purchase of Alphabet shares this spring after receiving an offer to join a large equity sale at a 6.5% discount. Abel says he quickly discussed the proposal with Buffett, and the two agreed they were comfortable completing the transaction as Alphabet raised capital for AI compute infrastructure.

Community resistance and wider investment outlook

Abel acknowledges that proposed AI data centers are facing growing community resistance across the U.S. He says developers need to evaluate local concerns seriously and address issues such as water use, while arguing that projects must deliver visible local benefits to become accepted members of their communities.

He points to Iowa, where Berkshire has a large utility presence, saying data centers there have generated substantial tax relief for residents and revenues for schools, police and fire departments. Beyond AI, Abel says he does not see an immediate recovery for U.S. homebuilders, although he expects Berkshire’s newly acquired Taylor Morrison to become a strong asset over the next five to 10 years because housing demand tied to the American dream remains intact.

Speaking from Japan, where he is visiting a Berkshire tool-making unit and meeting trading house executives, Abel says rising Japanese interest rates are not a fundamental challenge at present. He adds that Berkshire will continue to sell yen-denominated bonds as needed to support future investments in Japan, saying local rates remain relatively modest even after the 10-year yield climbed above 3% this week.

In our earlier article on rising U.S. resistance to AI data centers, we noted that public backlash is emerging as a material business and political risk for expanding AI capacity. The piece highlighted polling and investor concerns suggesting opposition goes beyond electricity and water usage, reflecting wider anxieties about how AI is being developed and governed—and warned that without clearer oversight and community benefits, pushback could slow the broader AI boom.

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