A research report from Orient Securities Company Limited indicates that electricity supply has become a critical bottleneck for data center deployment in North America. NVIDIA has invested in a North American power company, and regions like Texas, which are densely populated with data centers, are expected to intensify restrictions on grid connections. Self-built data centers may become one of the primary solutions for large-scale projects in the future, significantly boosting export demand for Chinese power equipment manufacturers.
The key points from Orient Securities Company Limited are as follows: NVIDIA has invested in power company Lancium, directly acquiring equity in the power infrastructure that supports its hardware operations. The investment is split into two parts: an initial $2 billion acquisition of a 20% stake in Lancium, with a potential additional $1 billion investment to increase its stake to up to 30%. Lancium, owned by Blackstone Group, was founded in 2018 in Houston, Texas. It has secured over 4 gigawatts of power contracts covering several heavyweight projects and is the power service provider for the "Stargate" AI campus in Texas, a collaboration between OpenAI and Oracle.
The shift from "chip shortage" to "power shortage" is evident. NVIDIA's investment is purely an equity stake, without involving credit guarantees for data center construction or leasing. This is a direct move by NVIDIA to combat power shortages, which could hinder the deployment of its next-generation Vera Rubin architecture in locations designed for high power consumption.
Texas has issued a grid connection ban, potentially pushing U.S. data centers toward "computing-power separation." On August 3, 2026, the Texas governor sent a formal letter to the state's Public Utility Commission and grid operator ERCOT, demanding a comprehensive verification and audit of all data center projects in the grid interconnection process. All new grid approvals will be suspended until the audit is completed. Projects that fail verification will not be allowed to connect to the Texas grid. According to data from the grid operator, the interconnection queue in Texas has accumulated over 1,800 projects, with a total requested capacity of 474 GW, approximately 90% of which is directly from data centers. The audit directive does not directly restrict projects that rely on on-site power generation and have minimal dependence on the public grid, making projects with self-generation arrangements more likely to pass verification.
There is optimism about the demand for power equipment driven by self-built data centers in North America. From a power generation perspective, gas-fired power, with its stable output and ability to adjust peaks, is better suited to the immediate controllable power needs of large data centers. From a transmission and distribution perspective, self-built data centers by North American cloud providers will significantly drive demand for primary power equipment, such as transformers and switches. Combined with the existing shortage of main transformers in North America, Chinese power equipment companies are poised to seize opportunities. From an AI data center perspective, the increasing power density of data centers is forcing upgrades to external power supply and distribution architectures. Solid-state transformers (SST), as the ultimate solution for external power supply and distribution, are expected to accelerate their industrialization in the context of North America's "power shortage."
Electricity is now the most critical constraint for data center construction, and there is a positive outlook for the export opportunities for Chinese power equipment firms amid the worsening "power shortage" in North America. Risks include potential capital expenditure shortfalls from overseas CSP vendors.
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