The S&P Global Commodities conference in Las Vegas brought together investors, developers, utilities, and hyperscalers at an inflection point for the power sector. Four themes dominated the conversation. Each one is directionally right. Each one is also commercially incomplete. Here’s what the conference said, and the nuances our analysts think were missed.
Gas Development M&A: Gas Is Back — But Buyers Want Cash Flow, Not Risk
New gas capacity is actively coming online in ERCOT, and the market is taking notice. As incremental supply builds, participants widely expect power curves to improve and stabilize — welcome relief after years of volatility.
But M&A activity tells a more selective story. Consolidation is happening, yet buyers are overwhelmingly focused on operating assets. Greenfield development is being passed over in favor of de-risked, cash-flowing positions. The risk appetite that once fueled new-build speculation has cooled considerably.
Buyers are prioritizing assets that are already generating — the market has decisively shifted toward capital efficiency over growth-at-any-cost.
What Was Missed
Capital has moved toward operating assets, but the valuations being paid are pushing close enough to new-build costs that the greenfield math changes. Enverus Intelligence® Research (EIR) priced Blackstone’s Hill Top acquisition at an implied 12.2% WACC. When operating multiples get this close to new-build costs, the greenfield math starts working again — especially for a future resale to a public IPP.
The purchase price equates to a multiple of ~$1.6 million/MW, representing a premium to recent gas generation M&A, approaching the estimated cost of new-build gas generation of ~$2-$3 million/MW.
– Blackstone Strikes Again | Plugging Into PJM’s Load Growth Deal Insight | September 24, 2025
What This Means
For developers, the operating-asset premium is a signal — not a barrier. With multiples approaching new-build costs, greenfield projects with a credible operational path are increasingly attractive to institutional capital positioning for IPP resale. For utilities, this compression creates asymmetric opportunity: acquire now at private-equity multiples, or hold assets that re-rate to public-IPP valuations as load growth materializes.
Nuclear & Hyperscaler Strategy: Hyperscalers Are Underwriting Nuclear — For 15 Years
Nuclear M&A is accelerating, and hyperscalers are the engine behind it. What has changed is conviction: the largest technology companies are no longer approaching nuclear cautiously — they are leaning in hard, driven by carbon commitments and mounting regulatory pressure.
Through 10–15 year nuclear PPAs, hyperscalers are effectively locking in stable, carbon-free power while completely sidestepping gas price volatility over that horizon. It is less a power procurement strategy and more a long-term hedge against regulatory and commodity risk.
What Was Missed
The premium hyperscalers pay for nuclear has grown 73% in two years. EIR priced every public deal: Susquehanna at $65/MWh, Comanche Peak at $90, Crane Clean Energy Center at $101. Uplifts to forward LMP run $22–$49/MWh across the six disclosed agreements. The “hyperscalers want nuclear” headline is directionally right. The commercial detail is in what each hyperscaler has paid, which plants are already under contract, and where pricing power sits going forward.
CEG, TLN and VST have signed significant offtake agreements for their nuclear facilities, with an average price premium of $34/MWh above zonal forwards at date of signing.
– Gone Fission | Nuclear PPA Comp Sheet Research | March 24, 2026
What This Means
For utilities with nuclear assets, this is a pricing event, not just a demand event. The $34/MWh average premium establishes a floor on what sophisticated off-takers will pay, and the 73% growth in willingness-to-pay since March 2024 signals the premium is still expanding. For developers, hyperscaler off-take terms are now a prerequisite for financing conversations — know which plants are contracted, which have capacity available, and what each hyperscaler has been willing to sign.
Investment Criteria Shifts: IRR Is the New Baseload
The old framework of ‘baseload good, variable bad’ is no longer the primary lens investors use. The conversation at S&P Global made clear that IRR, contract structure, and asset durability have overtaken traditional generation classifications as the dominant investment criteria.
Investors are less interested in what type of asset it is and more interested in whether it delivers the return profile they need — with defensible contracts and a durable operating life.
This shift creates opportunity for well-structured renewable and storage projects that previously struggled against baseload comparisons, while simultaneously raising the bar for anything that looks speculative or contractually exposed.
What Was Missed
IRR is a relative-value framework, not a market direction. The shift from “baseload good, variable bad” to IRR-and-contract-structure is real, but the same lens produces very different answers across the IPP universe. EIR ran the NAV on all five publicly-traded IPPs and found meaningful dispersion — some names trade at discounts to intrinsic value, others at premiums, with the gap driven by contract quality, capital cost exposure, and regulatory risk. The “IRR over baseload” framing is the right instinct. The discipline it requires is knowing which multiples, discount rates, and contract structures actually justify the valuation.
Recent PJM load forecast revisions and rising behind-the-meter data center development have put downward pressure on IPP stock prices, creating differentiated opportunities across names.
– IPP NAV Compass | Underappreciated PPA Upside Research | February 23, 2026
What This Means
For developers, contract quality isn’t a nice-to-have — it sets whether your project clears institutional return thresholds. For utilities and asset owners, the sector’s NAV dispersion is the actionable signal: durable cash flows and defensible contracts are being rewarded, while exposure to capital cost inflation and regulatory reform is being discounted. The acquisition and divestiture windows look very different depending on where in the dispersion your assets sit.
Data Center Growth & M&A Impact: Cheap Gas Wins the Data Center Race
Data center demand is no longer just a load growth story — it is becoming an ownership story. Hyperscalers are increasingly recognizing the value of controlling more of their own energy development pipeline, and they are entering the M&A market to do it. This is introducing a new class of buyers — some highly disciplined, others willing to pay prices that challenge conventional underwriting logic.
But the most consistent signal from the conference was geographic: the next wave of data center development will concentrate where natural gas prices are lowest. Hyperscalers are acutely cost-focused, and cheap gas today is widely expected to translate directly into data center construction over the next five years.
Regions with the lowest natural gas prices are not just attractive for power generation — they are likely to become the physical home of the AI economy.
What Was Missed
Cheap gas isn’t driving data centers into the Permian — it’s driving E&P operators into ERCOT. Waha averaged minus $6.83/MMBtu the week of April 14, 2026. The commercial response isn’t hyperscaler siting — it’s E&P operators monetizing stranded gas by building merchant generation into ERCOT. Riley Permian’s JV with Conduit Power is deploying four sub-10MW sites through ERCOT’s small generation queue. Continental and Mercuria announced a 452MW project in Pecos County converting ~80 MMcf/d of associated gas into power. The model is gas monetization, not data center attraction.
Permian gas is sometimes so cheap (or negative) that the normal relationship between fuel cost, efficiency, and dispatch breaks down, resulting in a small generator fleet that may look like peaker plants but are dispatched more like baseload power plants.
– Think ERCOT, Not Waha | April 23, 2026
What This Means
For utilities in the Permian and adjacent ERCOT zones, the near-term load growth isn’t coming from hyperscalers — it’s coming from E&P operators building behind-the-meter generation and selling into the grid. For developers, the hyperscaler siting conversation and the cheap-gas conversation are two different trades; don’t confuse the basis differential with the data center map.
See Where These Trends Hit Your Markets
Enverus tracks gas price dynamics, interconnect queue positioning, and hyperscaler demand signals across every major market. Reach out to our Enverus Intelligence® Research team to see how these shifts affect your specific territory, portfolio, or pipeline.
About Enverus Intelligence® | Research
Enverus Intelligence® | Research, Inc. (EIR) is a subsidiary of Enverus that publishes energy-sector research focused on the oil, natural gas, power and renewable industries. EIR publishes reports including asset and company valuations, resource assessments, technical evaluations, and macro-economic forecasts and helps make intelligent connections for energy industry participants, service companies, and capital providers worldwide. See additional disclosures here.
