Picture this: you’re scrolling through your investment portfolio, wondering where the next big opportunity lies. The tech giants have been the talk of the town for years, but what if I told you that a sleepy, often-overlooked sector is quietly stealing the spotlight in 2025? Utilities—yes, those steady, predictable companies powering our homes—are suddenly the market’s dark horse, and I’m here to tell you why they deserve your attention.
The Unexpected Rise of Utilities in 2025
Utilities have long been the wallflowers of the stock market, offering stability but rarely the excitement of tech or growth stocks. However, something seismic is happening. The surge in artificial intelligence (AI) and data center expansion is rewriting the rules, placing utilities at the heart of a new economic boom. These companies aren’t just keeping the lights on anymore—they’re powering the future of technology. Let’s dive into why this sector, and one stock in particular, is turning heads.
The Data Center Boom: A Game-Changer for Utilities
Ever wonder where the internet lives? It’s not in the cloud, despite the dreamy marketing. It’s in massive data centers, and one place stands out above the rest: Loudoun County, Virginia, often called Data Center Alley. This unassuming region handles a staggering 70% of global internet traffic daily, according to industry insights. With tech giants like Amazon, Meta, and Google expanding their digital footprints, the demand for electricity to power these facilities is skyrocketing.
Why does this matter for investors? Data centers are energy hogs, and utilities are the ones feeding them. The growth in AI-driven computing means this demand isn’t slowing down anytime soon. In my view, this is a rare moment where a traditionally stable sector gets a turbo boost from cutting-edge innovation.
The data center boom is a once-in-a-generation opportunity for utilities to shine.
– Energy market analyst
Dominion Energy: A Utility Stock to Watch
Enter Dominion Energy, a utility giant that’s perfectly positioned to ride this wave. Based in Virginia, Dominion is the go-to power provider for Data Center Alley. With contracts to supply 9 gigawatts (GW) of electricity to data centers and another 5 GW in the pipeline, the company is locking in long-term revenue streams. This isn’t just about keeping servers humming—it’s about fueling the AI revolution.
What makes Dominion stand out? For one, its 4.4% dividend yield is a juicy perk for income-focused investors. Plus, the stock is flirting with new 52-week highs, showing momentum that’s hard to ignore. The company recently proposed a rate increase to regulators to support its infrastructure investments, with a decision expected soon. If approved, this could be the spark that sends the stock soaring.
- High Dividend Yield: 4.4%, offering steady income.
- AI-Driven Demand: Long-term contracts with tech giants.
- Strategic Location: Serving the heart of Data Center Alley.
Why Utilities Are Outshining Tech in 2025
Let’s talk numbers for a second. As of early August 2025, utilities are flexing their muscles while tech stocks take a breather. The median utility stock boasts a Relative Strength Index (RSI) of 64, with 90% trading above their 20- and 200-day moving averages. Compare that to tech, where the median RSI is a lackluster 41, and only 38% of stocks are above their 20-day moving average. The gap is stark.
Utilities aren’t just holding steady—they’re leading. In fact, they’ve climbed to the top spot as the best-performing sector year-to-date. This isn’t a fluke. The market is waking up to the fact that AI’s growth depends on reliable power, and utilities are the backbone of that infrastructure. I find it fascinating how a sector once considered “boring” is now outpacing the darlings of Silicon Valley.
| Sector | Median RSI | % Above 20-Day MA | % Above 200-Day MA |
| Utilities | 64 | 90% | 90% |
| Technology | 41 | 38% | 57% |
The Renewable Energy Angle
Dominion isn’t just about traditional power. It’s also making waves in renewable energy. Take its Coastal Virginia Offshore Wind project, a massive undertaking set to deliver 3 GW of clean energy by 2026. This project isn’t just good for the planet—it’s a strategic move to meet the growing energy needs of data centers, military bases, and industrial hubs. With bipartisan support and federal permits in place, it’s a low-risk, high-reward venture.
Why do I love this? It shows Dominion is thinking long-term, blending traditional utility stability with forward-thinking sustainability. It’s the kind of move that makes a company resilient in a changing world.
Renewable energy isn’t just a trend—it’s the future of utilities.
– Industry expert
Risk Management: Playing It Smart
No investment is a sure thing, and Dominion is no exception. The stock is testing its 200-week moving average, a key technical level. A drop below $50 could signal trouble, so traders might want to keep that as a pivot point. For long-term investors, though, a dip could sweeten the dividend yield, making it an even more attractive buy-and-hold.
Here’s my take: the utility sector’s strength gives Dominion a solid tailwind, but it’s not immune to market swings. The upcoming rate case decision could be a make-or-break moment. If regulators greenlight the increase, it’s a win. If not, expect some short-term volatility. Either way, the long-term story—AI-driven demand and renewable energy growth—remains intact.
- Monitor Key Levels: Watch the $50 mark for potential exits.
- Stay Informed: Track the rate case decision expected in September 2025.
- Think Long-Term: Focus on dividends and AI-driven growth.
The Bigger Picture: A Market Rotation
Here’s where things get really interesting. The market is undergoing a rotation, with value-oriented sectors like utilities gaining traction while tech takes a breather. Nearly 60% of S&P 500 stocks are underperforming the index this year, showing that the rally has been narrow. Utilities, with their steady dividends and newfound relevance, are stepping into the gap.
This rotation isn’t just a blip—it’s a sign of a healthier market. When undervalued sectors start to shine, it opens up opportunities for investors who’ve been sitting on the sidelines. I’m optimistic about what this means for the rest of 2025. Could utilities be the key to a balanced portfolio? I think so.
Why Now Is the Time to Act
If you’re looking for a sector that combines stability, income, and exposure to the AI boom, utilities are hard to beat. Dominion Energy, with its strategic position in Data Center Alley, strong dividend, and renewable energy push, is a standout. The stock’s momentum, coupled with the sector’s strength, makes it a compelling pick for 2025.
But don’t just take my word for it. The numbers speak for themselves: utilities are outperforming, and the demand for power is only growing. Whether you’re a trader chasing momentum or an investor seeking passive income, this sector—and Dominion in particular—deserves a spot on your radar.
Utilities are no longer the sleepy giants of the market—they’re waking up.
So, what’s your next move? Will you ride the utility wave or stick to the tech hype? I know where I’m placing my bets, and I’m excited to see where this sector takes us in the months ahead.
Disclaimer: This content is for informational purposes only and does not constitute financial advice. Always consult a financial advisor before making investment decisions.
