3 Energy Stocks Yielding Over 4.5% to Cash in on the AI Power Boom
2026-07-25 15:15
•Reuben Gregg Brewer •The Motley Fool
••••••• •••••••• Axe Capital view
Energy Yields and AI Demand: A Local Take
Global AI growth boosts energy infrastructure, but South African investors should look closer to home.
The AI boom’s hunger for reliable electricity shines a spotlight on energy infrastructure firms abroad, with US pipeline giants like Enterprise Products Partners and Enbridge offering juicy yields around 5%. Their stable cash flows come from long-term contracts that underpin dividend reliability. However, SA investors won’t find direct JSE equivalents with such long yield histories. Instead, Sasol stands out as the closest proxy due to its integrated energy business and yield tailwinds benefiting from natural gas and oil price dynamics. Sasol’s exposure to global energy supplies and its improving balance sheet make it a better bet than chasing overseas names through currency risk. Meanwhile, the rand trades near 18.50 to the dollar, so sitting on offshore pipeline plays exposes you to rand volatility. And clean energy is growing here, too—like Globeleq and emerging infra funds—but not yet with Brookfield Renewable’s scale or contracts with tech giants like Microsoft. For now, local investors should balance yield and currency risk carefully. this is just my opinion and not financial advice
Buy Sasol for yield and energy exposure, avoid direct investment in US midstream names due to rand risk, and watch clean energy locally for entry points.
- Sasol
- USD/ZAR
- Rand weakness increasing offshore exposure risk
- Global energy demand shifts affecting Sasol margins
7/10
As AI data centers demand massive amounts of electricity, energy infrastructure companies are positioned to benefit. Enterprise Products Partners and Enbridge, which operate natural gas pipelines, offer yields of 5.7% and 4.9% respectively with long histories of dividend increases. For investors preferring clean energy, Brookfield Renewable Partners offers a 4.9% yield while supplying power to Microsoft and Google's AI data centers.
This article was originally published by The Motley Fool and has been adapted here for Axe Capital Trading News.
Publisher: The Motley Fool
Author: Reuben Gregg Brewer
Categories: Rates, Equities, Capital Returns, Commodities, Technology, AI, Semiconductors
Tickers: EPD, ENB, BEP, BEPH, BEPI, BEPJ, BEPPA, MSFT
Sentiment: Positive - Highest yield at 5.7% with 27 consecutive years of annual distribution increases. Well-positioned to benefit from increased natural gas demand driven by AI data centers. Reliable cash flows from infrastructure fees. Strong 4.9% yield with 31 years of consecutive dividend increases. Major midstream operator benefiting from growing energy infrastructure demand. Reliable, though slow-growing, investment with stable cash flows.
Keywords: AI data centers, electricity demand, natural gas infrastructure, high-yield dividends, clean energy, midstream energy
Insights:
- EPD: Positive: Highest yield at 5.7% with 27 consecutive years of annual distribution increases. Well-positioned to benefit from increased natural gas demand driven by AI data centers. Reliable cash flows from infrastructure fees.
- ENB: Positive: Strong 4.9% yield with 31 years of consecutive dividend increases. Major midstream operator benefiting from growing energy infrastructure demand. Reliable, though slow-growing, investment with stable cash flows.
- BEP: Positive: Offers 4.9% distribution yield with clean energy alternative for carbon-averse investors. Already has contracts with Microsoft and Google for AI data center power supply. Regular distribution increases over a decade, though requires closer monitoring due to active portfolio management.