With energy demand set to skyrocket in the next decade, now is a great time to snap up these two energy stocks.
Energy is the lifeblood of our economy, powering everything from factories to homes and the data centers that drive the next generation of artificial intelligence (AI). According to the Bank of America Institute, an internal think tank of the eponymous bank, energy demand is expected to grow at a rate 5 times faster over the next decade than it did over the previous decade.
With energy demand set to surge in the coming years, here are two energy stocks you can confidently scoop up today.
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NextEra Energy (NEE 3.15%) operates as one of the largest electric utility and renewable energy companies in the U.S. The company operates two primary businesses: Florida Power & Light (FPL) and NextEra Energy Resources.
FPL is the largest regulated utility in the U.S., and provides NextEra with predictable earnings. As a rate-regulated utility, FPL's rates cover its cost of service while providing a reasonable rate of return on its invested capital. The Florida Public Service Commission approved a four-year rate agreement (January 2026 through December 2029) that grants FPL an allowed midpoint regulatory return on equity of 10.95%, providing stability and visibility into future earnings.
Meanwhile, NextEra Energy Resources is the world's largest renewable energy business, focusing on developing and operating renewable energy infrastructure, including wind, solar, nuclear, natural gas, and battery storage. With approximately 37,505 megawatts (MWs) of net generating capacity, this business gives NextEra upside growth through long-term contracts.
For investors seeking stable long-term growth, NextEra is a solid choice. Additionally, investing in the stock offers investors both growth and income. The stock currently yields 2.74%, and the company has increased its annual payout for 31 consecutive years.
With stability from its utility business and upside potential from its renewables business, which stands to benefit from surging power demand from technology companies, NextEra Energy is an excellent long-term investment.
Cheniere Energy (LNG 0.35%) is the largest U.S. producer of liquefied natural gas (LNG), a cooled form of natural gas that can be efficiently transported worldwide. This fuel is seen as a bridge fuel between traditional fuels and renewables because it emits up to 50% less carbon dioxide than coal.
Another benefit of this fuel is that gas-fired plants can ramp up quickly to meet demand, complementing intermittent renewable sources like wind and solar.
The company operates a highly contracted business model, with roughly 90% of its capacity sold under take-or-pay contracts. Under these contracts, customers pay a fixed fee per MMBtu (metric million British thermal units) of LNG, with a portion of the fee adjusted annually for inflation. This structure offers strong revenue stability, as customers must pay this fixed fee for contracted volumes, even if they elect to cancel or suspend their deliveries.
Cheniere essentially acts as the toll booth for U.S. gas bound for Europe and Asia, as its pipelines connect all five major U.S. natural gas basins and serve as a gateway to international markets. Over the past three years, 66% of its cargoes have been directed to Europe to replace Russian natural gas supplies.
For investors looking to capitalize on the U.S.'s booming LNG production, Cheniere is another excellent stock to own for the long haul.
Bank of America is an advertising partner of Motley Fool Money. Courtney Carlsen has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Cheniere Energy and NextEra Energy. The Motley Fool has a disclosure policy.
*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.
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