Microsoft Makes a Massive Move to Secure Its AI Future Moz Farooque ACCA Fri, October 16, 2026 at 4:56 PM EDT MSFT -1.93% NI +3.47% Explore stocks on Coinbase Trading disclosure Trading disclosure The above button links to Coinbase. Yahoo Finance is not a broker-dealer or investment adviser and does not offer securities or cryptocurrencies for sale or facilitate trading. Coinbase pays us for certain activity generated through this link. Prices displayed are informational.
NiSource (NYSE:NI) shares rose after the utility signed a 20-year energy agreement with Microsoft (NASDAQ:MSFT) to supply roughly 1,100 megawatts of new generation capacity beginning in 2028.
The deal is another sign of just how much power Big Tech is securing for future data-center expansion.
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Under the agreement, NiSource's NIPSCO and GenCo units will provide the generation and transmission infrastructure needed to serve Microsoft's load while continuing to support existing customers in Indiana.
Microsoft will fully fund the generation and transmission assets required for its data-center demand, according to the companies.
That point matters because utilities across the U.S. are facing growing scrutiny over whether residential customers could end up subsidizing infrastructure built for hyperscale data centers.
The new assets are also expected to strengthen NIPSCO's transmission system, improving grid reliability and resilience for existing customers.
The agreement includes another major component: 600 MW of battery storage under a long-term tolling agreement with GenCo. The storage facility will be developed and constructed by an affiliate of AGP Group.
NiSource said the Microsoft agreement increases expected savings for NIPSCO electric customers over the life of its data-center contracts to about $1.75 billion, up from the previously disclosed $1.4 billion.
That could equate to savings of as much as $140 per customer annually.
Shares of NiSource gained roughly 3% in early Friday trading following the announcement.
I think the more important part of this deal is not simply the 1,100 MW headline.
Microsoft is effectively underwriting the infrastructure required for its own demand, while NiSource gains a very large, long-duration customer without shifting the capital burden onto existing ratepayers.
That could make the agreement a useful template for utilities trying to capture AI-driven electricity demand without creating political or regulatory backlash.
For investors, the key things to watch are project execution, regulatory approvals, returns on invested capital, transmission expansion and whether NiSource signs additional hyperscaler agreements.
If more data-center customers are willing to directly fund the infrastructure they require, AI-related load growth could become a much cleaner earnings opportunity for regulated utilities.
