Clean grid infrastructure fund outperforms utilities ETF as AI-driven power demand boosts equipment makers.

The Utilities Select Sector SPDR Fund (XLU), focused on regulated utilities, has gained 7.03% year-to-date, lagging behind the First Trust NASDAQ Clean Edge Smart Grid Infrastructure Index Fund (GRID), which is up over 23%. GRID invests in equipment makers and transmission specialists benefiting directly from AI-driven data center power demand, unlike XLU which grows slowly through regulated rate cases. Companies like GE Vernova and Quanta Services report strong order backlogs and revenue growth, driving GRID's superior returns. While GRID has higher fees and lower dividends, it captures the faster-growing equipment cycle tied to AI power needs, making it a compelling partial swap for investors targeting AI exposure in utilities.