The Utility-Electric Power industry in the U.S. is experiencing a significant transition towards cleaner energy sources, with renewable electricity generation projected to increase from 23% in 2025 to 28% by 2027, according to the U.S. Energy Information Administration. This shift is being driven by investments in renewable energy, supported by government initiatives like the Inflation Reduction Act, which provides stability for low-cost clean energy solutions.
NextEra Energy (NEE), Ameren Corporation (AEE), Alliant Energy Corporation (LNT), and Pinnacle West Capital Corporation (PNW) are among utilities benefitting from these trends, with combined planned capital investments exceeding $121 billion through 2029. Electricity consumption in the U.S. is expected to rise by 1% in 2026 and 3% in 2027, accompanied by price increases of 1.9%, 2.3%, and 3.8% across industrial, commercial, and residential sectors respectively, further boosting revenues in the industry.
The Utility-Electric Power sector has outperformed the S&P 500 over the past year, registering a 24.2% increase compared to the S&P’s 16.5%. As of now, the industry trades at an EV/EBITDA multiple of 13.24, which is competitive compared to the S&P 500 at 18.9. Analysts project a positive earnings outlook for the sector, as reflected in its Zacks Industry Rank of #87, placing it in the top 36% among over 244 industries tracked.
