5 growth drivers powering infrastructure returns in 2026 - and 2 stocks to watch

AI has dominated the market narrative in 2025 but for infrastructure investors, the story runs deeper than data centres. Because behind the surge in compute, cloud and onshoring sits a far more complex question - can existing networks keep up? And who pays for the rebuild required to enable the biggest technological shift of our generation?

In this rapid fire interview, Sarah Shaw from 4D Infrastructure lays out where the opportunities are building, where the risks are underestimated, and why infrastructure is quietly shedding its reputation as a defensive backwater.

The big theme in 2025 across markets has been AI, and the power demand is reshaping global infrastructure. What are the biggest structural shifts investors need to understand right now?

The ‘Rise of Technology’ is one of the five core global infrastructure growth themes for the foreseeable future, as power demand and load growth are highly correlated to data centre development and the rise of AI.

To date, this has been a very US-centric thematic, with the power load growth outlook in the US market highly correlated to this technology thematic. Across the rest of the globe, the technology thematic is getting some airtime, but its realisation is not as imminent, and within the infrastructure sector, it will take a back seat to other much-needed network investment.

In terms of the AI theme, we see the biggest near-term risks to be speed of execution and affordability concerns:

• Speed of execution - How quickly can investors expect data centre demand to translate into utility earnings? To be very clear, the theme is real and the demand for power is also growing significantly, but to translate into utility company earnings is not a 2025 or 26 story but more one for the back end of the decade once investment has been made and the demand can be supported. Impacting the time to delivery include things like baseload generation availability and build of new grid connections, supply chain constraints for construction, carbon goals at national and corporate levels and cost metrics.

• Affordability - One risk with load demand growth, specifically that delivered through large individual loads such as data centres, is that the incremental investment in generation and transmission needed to facilitate that demand should not be subsidised by existing customers (especially residential and small commercial customers). Even if implemented optimally, affordability will remain a concern for customers, legislators and regulators as these investment dynamics roll out. As we head into an election year in the US, affordability will also be used as a political tool and nuances for States and companies alike must be managed.

Where are the most compelling opportunities emerging across the different infrastructure subsectors?

4D’s biggest portfolio exposure is networks, and we are incredibly excited about the investment opportunity associated with networks for the coming decade. This is not just a technology thematic, despite technology and associated power demand being the theme that is gaining the most news flow recently. 

Of the five core growth drivers underpinning infrastructure over the coming years, every one of them is dependent on significant network investment, and our networks overweight is diversified to capitalise on each of them.

1. Developed market replacement spend – ageing infrastructure is creating social and economic impacts in the developed world as it fails to support evolving population dynamics. Governments and regulators have finally recognised the need to upgrade and are supporting significant investment pipelines. A good example of this is UK water, where regulatory asset base growth has doubled to 9% versus historical ~4% for the foreseeable future. 

In the electricity space, another example is the European grid, which is one of the oldest in the world (over 40 years) and must be upgraded to support population growth and energy shifts before they even think about technology.

– largely driven by the emerging world, which demands increased investment in networks to support the growth itself. Load growth linked to population growth is an attractive dynamic for the emerging world, particularly when coupled with the third thematic below.

3. Emergence of middle class – 85% of the global population lives in the emerging world, and as wealth improves and the middle class grows, so does the demand for water, power and gas, which requires huge investment in grids to support connections, usage and security of supply. A good example of capitalising on this opportunity is our Brazilian networks exposure across water and power as well as our exposure in Malaysia. 

Importantly, energy demand per capita in the emerging world is only one-third of that in the developed world, so as the middle class continues to evolve, this is going to support decades of new network investment.

4. Energy transition – the move to a cleaner environment requires huge network investment to connect new generation sources, strengthen grids and solve for the intermittency of supply as renewable generation is added to the mix. The Spanish blackout in April this year (triggered by renewables) highlighted the problem of grid under-investment compounded by increasing renewables. We are capitalising on this across Europe, where huge investment needs across the continent are met with continued policy support for renewables. I highlight our UK, Spanish and Italian network exposure as good examples of significant investment growth linked to the energy transition.

5. Rise of technology – an exciting long-term thematic, as power demand and load growth are highly correlated to data centre development and the rise of AI. This is being realised in the US already and will become a global theme over the coming decade.

What are the key risks that investors often underestimate in this environment?

The key risks to infrastructure investment are macro, geopolitical and increasingly environmental (weather events). 

Infrastructure assets are long-dated assets with high up-front capital costs that need time to realise a return. As such, the sanctity of the contract and/or regulation underpinning the initial investment is essential. They must be able to withstand any geopolitical intervention (Trump and his OBBA threats), economic shocks (inflation, interest rates) or environmental events (wildfires, drought) and support investment with a return over a life cycle of 20 years or more.

Thankfully, infrastructure has a long history of regulatory environments designed to do exactly that and active management of these elements on a global scale helps further mitigate risk.

Can you share a high conviction infrastructure pick or two for 2026? What makes them stand out?

SSE (LON: SSE) is our top pick leading into 2026 – it is a high-quality integrated UK utility operating in one of the most supportive markets globally for energy-transition investment. Its November strategic update has improved earnings quality by shifting the portfolio more heavily toward regulated networks (now 80% networks, 20% renewables, previously 50/50).

SSE now has the fastest RCV growth in the sector at a 25% CAGR, and its recent capital raise has eased market concerns around funding. The company offers the highest adjusted EPS CAGR in the integrated utility peer group at 7–9%, with earnings quality also expected to improve through 2030. 

Further upside is supported by execution in the networks business, continued renewable development, and potential asset sales.

Another high conviction and recent addition to our portfolio is Gek Terna (FRA: 1GT) - a high-quality Greek infrastructure company that has successfully transformed into a toll-road-focused operator. The divestment of its renewable energy business has been monetised at an opportune time and reinvested into premium toll road assets driving expected group EBITDA growth of >70% over the next four years. 

The company benefits from sector-leading construction capabilities, long-duration and highly predictable assets, and a management team with a strong execution track record, all supported by a favourable macro environment driven by Greece’s economic recovery and EU-backed infrastructure investment. 

The base case also sees further upside from €8–10bn of forthcoming tenders in which Gek Terna is well positioned to win additional concessions. 

Although execution complexity and concentrated domestic exposure remain key risks, our valuation more than compensates for these risks.

What’s one infrastructure subsector or trend that could genuinely surprise investors over the next 2–3 years?

We think the utility sector will continue to surprise over the coming 2-3 years and over the next decade as investment plans continue to build and expand and companies execute thereon, ultimately translating into earnings growth. 

Utilities are no longer a 'boring yield play/bond proxy' but assets delivering very strong earnings growth within a secure, visible, regulated framework in a sector with numerous, interlinked supportive growth drivers.