Elon Musk's Gas Plant for AI Data Centers Lifts Midstream Stocks

Elon Musk built a natural gas power plant in Mississippi to supply two AI data centers in Tennessee. The facilities, called Colossus I and II, are among the largest computing clusters in the world. Musk purchased natural gas turbines directly from manufacturers and constructed an off-grid plant to avoid years-long waits for grid connections, according to a Motley Fool analysis published this week.

Grid-linked power would have pushed up electricity rates for other customers, a problem regulators and utilities have flagged. By building his own plant, Musk sidesteps those delays and cost disputes. The approach reflects a pattern that energy analysts have been watching for months: AI's appetite for computing power is growing faster than renewable sources can keep up, forcing developers to turn to natural gas as a baseload option.

That demand matters for midstream energy companies that move natural gas through pipelines. Enterprise Products Partners, Enbridge, and Kinder Morgan own the networks that connect supply basins to power plants and export terminals. Higher volumes mean higher fee income, regardless of where gas prices sit. Kinder Morgan claims the largest U.S. natural gas transmission network, a position that becomes more valuable as off-grid power plants proliferate.

Enterprise Products Partners yields 5.7%, Enbridge 5%, and Kinder Morgan 3.6%. All three are income stocks, not growth plays like Tesla or SpaceX. The durability of their payouts rests on sustained throughput. The Musk plant is a concrete example of a new demand source that could run for decades. The Motley Fool article noted that if Musk's approach is any indication of the future, these three companies have solid long-term outlooks.

The trend extends beyond the U.S. Electricity demand is rising globally, and clean energy alone may not cover the gap. Natural gas exports, already a growth engine for North American pipeline operators, could get another boost as overseas data center developers also seek reliable power.

Regulatory pushback is a risk. Local residents and environmental groups in Tennessee and Mississippi have sued over the plant, arguing it was permitted without full environmental review. The U.S. government has backed the project, signaling support for energy infrastructure linked to national AI priorities, the article said.

AlphaScala's scoring system rates Kinder Morgan at 60 out of 100 and Enbridge at 58, both labeled Moderate. The sector's balanced risk profile reflects steady fee income offset by pipeline regulation and commodity-cycle exposure. The Colossus data centers are expected to be fully operational by the end of 2026, according to reports cited in the analysis.