The report from IFM Investors, the fourth-largest global infrastructure manager, has sparked a vigorous conversation among energy sector enthusiasts and investors. The report, Infrastructure Horizons 2025, doesn’t just highlight the growing interest in sustainable aviation fuel, renewable natural gas, and AI—it dares investors to think critically about the evolving infrastructure landscape.
AI, data centres, and the energy transition are not just buzzwords; they are the hearts of the new infrastructure narrative. The AI revolution is set to transform infrastructure, particularly in data centre construction and electricity and fibre optics networks. We’re witnessing a shift where data centres are being directly linked with renewable energy generation sites. Developers are no longer just passive consumers of power; they are actively “following the power,” creating a symbiotic relationship between data infrastructure and renewable energy.
The energy sector’s outlook is notably optimistic, with demand surging at an unprecedented rate. The report’s prediction of a “rapid convergence of renewable power generation, energy storage, and digital infrastructure” is more than just a forecast—it’s a call to action. This convergence is not merely to meet the power demand from AI and similar technologies but also to align with net-zero objectives and initiatives from data centre operators. Corporates are already developing tailored solutions, such as co-locating renewable energy sources with data centres, to ensure power security and gain competitive advantages.
However, the report also underscores a significant shift in global economic dynamics. Deglobalisation is no longer a mere theoretical concept; it’s a tangible force driving countries to secure their energy, mineral, and manufacturing needs from local sources. Geopolitical instability and rising uncertainty within the global economy are fuelling this trend. While the global economy will remain interconnected, we’re witnessing a renewed focus on reshoring industries and building national economic self-sufficiency. This shift will inevitably lead to more protectionist policies, as governments seek to protect domestic economies and improve global competitiveness.
For infrastructure investors, this means evolving to meet these changing economic needs. As Luba Nikulina, IFM Investors’ chief strategy officer, aptly put it, “The opportunity set and investment universe of these infrastructure technology opportunities are only limited by the speed of technological developments emerging.” Investors will need to adopt a risk factor-based approach, disentangling the risk and return drivers of these assets. The traditional view of infrastructure as a monolithic whole is becoming obsolete.
The implications for markets are profound. We’re seeing the birth of new investment opportunities that span digitalisation, automation, and the energy transition. The convergence of renewable power generation, energy storage, and digital infrastructure is not just an investment trend; it’s a strategic imperative. Those who can navigate this complex landscape and capitalise on these opportunities will shape the future of the infrastructure sector.
Moreover, the deglobalisation trend could lead to a significant restructuring of supply chains and manufacturing processes. This could open up new opportunities for local infrastructure development, but it also poses challenges, such as increased costs and potential inefficiencies.
The report from IFM Investors is more than just a market analysis; it’s a wake-up call for investors and policymakers alike. It challenges us to think deeply about the implications of AI, the energy transition, and deglobalisation on the infrastructure sector. It dares us to question our assumptions and embrace a more nuanced, risk factor-based approach to infrastructure investment.
The energy sector is on the cusp of a significant transformation. The question is, are we ready to seize the opportunities and navigate the challenges that lie ahead? The future of infrastructure investment is not predestined; it will be shaped by those who dare to think differently and act boldly.
