CenterPoint Energy (CNP, Financial) reported a decline in first-quarter profits, yet increased its capital expenditure plans to meet the anticipated demand from data centers utilizing artificial intelligence technology. A severe winter storm in January impacted the U.S. Gulf Coast, causing extensive disruptions and record-low temperatures, which in turn escalated operational and maintenance costs for utility companies. CenterPoint's operational costs rose by 5.4% year-over-year to $747 million, while expenses for natural gas, fuel, and purchased electricity surged nearly 28% to $1 billion.
Despite these challenges, CenterPoint raised its 10-year capital spending plan by $1 billion to $48.5 billion, anticipating a surge in demand from AI companies. U.S. utility companies are significantly increasing their capital expenditure plans due to high demand from tech giants seeking new power supplies for data centers across the country. CenterPoint noted a nearly 7-gigawatt increase in new connection requests since January, reinforcing its confidence in Texas's strong economic outlook and justifying the enhanced capital investment.
The Houston-based company serves over 7 million customers with electricity and natural gas in Indiana, Louisiana, Minnesota, Mississippi, Ohio, and Texas. For the quarter ending March 31, CenterPoint's net income fell to $297 million, or 45 cents per share, from $350 million, or 55 cents per share, a year earlier.
