Electrification and Grid Modernization - The Essential Upgrade

Global electricity demand is accelerating, driven by AI, EVs, and reindustrialisation. It is projected to grow at an average annual rate of 4% through 2027. In the US, major grids like PJM and ERCOT expect capacity needs to jump by tens of gigawatts. 

Yet the infrastructure is not ready: over 70% of American transmission lines are over 25 years old, and grid failures already cost the U.S. economy ~$150 billion annually, while recent major outages across Europe have underscored the fragility of aging grid infrastructure and the growing systemic risk of power disruptions.

Modernizing the grid - through automation, real-time controls, and distributed capacity - is no longer optional. It is the structural enabler of electrification, irrespective of the generation mix. Governments are acting: the U.S. has launched the $10.5 bn DOE Grid Resilience Program in addition to existing tax credits and grants. The EU has €345 bn of planned TSO investment under Fit-for-55 and REPowerEU, the UK approved £24 bn in grid spending to 2031, and India is rolling out a $37 bn smart metering initiative.

Recent strong price action in copper, uranium, platinum, and palladium - metals essential to grid hardware, clean baseload, and industrial electrification - suggest that the market is increasingly pricing in the deployment of these long-term infrastructure trends. Smart grids aren’t a clean energy bet, they’re the foundation of energy security and resilience.

The structuration we made is based on two global industry leaders with complementary roles: one provides the physical grid backbone - switchgear, breakers, transformers - while the other integrates the intelligence layer through energy automation, control software, and data centre solutions. Their exposures are geographically distinct, their customer bases differ, and they operate in different layers of the value chain, making them synergistic, not overlapping.