The Energy IPO Boom Is Just Getting Started. Here Are the Companies to Watch.

Energy stocks have come into focus during the past year amid the rapid expansion of artificial intelligence infrastructure. Modern-day data centers require vast amounts of reliable energy, forcing technology giants to look beyond the grid and toward next-generation power technologies.

This surge in energy demand has put energy stocks on the map, including start-ups across nuclear energy, fission and fusion, solar power, and battery technology. For investors monitoring the energy technology space, here are some of the top companies to watch right now.

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AI data centers are fueling an energy IPO boom

According to Gartner, a global research firm, data center electricity consumption is projected to surge 26% in 2026, reaching 565 terawatt-hours (TWh). This jump in demand is causing major bottlenecks, and 30% to 50% of the large-scale data center capacity expected to come online in 2026 faces major delays, according to energy intelligence firm Currence.

This year, several energy start-ups have entered the public markets, including Solv Energy (NASDAQ: MWH), X-energy (NASDAQ: XE), and Fervo Energy (NASDAQ: FRVO). These companies entered the public market in the middle of the boom in energy demand and are looking to capitalize on this investor interest while raising much-needed capital to continue scaling and building their infrastructure.

Solv Energy provides infrastructure services for the power industry. It specializes in designing, constructing, and maintaining utility-scale solar and battery storage projects, along with related transmission and distribution infrastructure. It was previously a part of Swinerton Construction Company, a 138-year-old private company located in California.

Of the three energy start-ups that went public this year, Solv Energy is more established and generated $677 million in revenue and $119 million in gross profit in the first quarter. The company did have a net loss of $27 million, driven by noncash compensation expenses, but it also boasts an order backlog of over $8 billion.

Fervo Energy operates in the geothermal energy sector by adapting horizontal drilling and hydraulic fracturing techniques borrowed from the oil and gas industry to build enhanced geothermal systems. Instead of relying on natural hot springs, Fervo drills thousands of feet underground into hot rock, fractures it, and circulates water to generate electricity.

Meanwhile, X-energy has spent the last decade developing the Xe-100 advanced small modular reactor (SMR), which uses TRISO fuel (uranium kernels wrapped in melt-proof ceramic and a graphite layer) and helium gas for cooling, enabling it to generate electricity and high-heat industrial steam, which allows it to decarbonize heavy chemical manufacturing and industrial processes.

What makes TRISO fuel appealing is that it retains radioactive fission products even in extreme heat scenarios above normal operating conditions, effectively reducing the risk of a nuclear meltdown.

Both Fervo Energy and X-energy are early-stage companies looking to scale up and commercialize their offerings. Fervo and X-energy have both experienced losses every year since their founding, racking up accumulated deficits of $276 million and $1.4 billion, respectively.

Private energy companies are making strides as well

Beyond these newly public companies, other next-generation private energy companies are developing advanced fission and fusion technologies. Nvidia-backed TerraPower and Kairos Power, which signed a power purchase agreement with Alphabet's Google, are developing advanced nuclear reactors that use liquid-sodium and molten-salt cooling mechanisms, respectively, to improve the safety and efficiency of SMRs.

Meanwhile, nuclear fusion companies like Commonwealth Fusion Systems and Helion Energy are advancing the technology. These companies take two completely different approaches to generate nearly limitless energy out of hot plasma. Benefits from fusion technology include zero long-lived radioactive waste and total safety from nuclear meltdowns.

As AI usage grows and data centers expand, power supply has become a primary bottleneck for major technology companies. The initial public offerings of Solv Energy, X-energy, and Fervo Energy, and the ongoing progress from TerraPower, Kairos Power, Commonwealth Fusion, and Helion illustrate how next-generation energy solutions are becoming crucial for the future development of artificial intelligence.

Courtney Carlsen has positions in Alphabet and Nvidia. The Motley Fool has positions in and recommends Alphabet, Nvidia, and Solv Energy. The Motley Fool recommends Gartner. The Motley Fool has a disclosure policy.