Enerflex (TSX:EFX) rose nearly 15% in early Toronto trading after the Calgary-based energy infrastructure company won a contract to design and build 450 megawatts of natural-gas-fired power generation for a North American data-centre developer — the latest sign that the AI boom’s hunger for electricity is reaching traditional energy names.
Enerflex said it secured a contract to design and build 450MW in natural-gas-fired power generators for a North American data-centre developer. The counterparty was not identified, and financial terms were not disclosed.
The project will be executed through Enerflex’s North American manufacturing operations, with deliveries scheduled to start in 2027 and be completed in 2028. Beyond the initial equipment, the company said the deal opens up opportunities for future commissioning, installation and aftermarket services support.
The market reaction was immediate: Enerflex shares climbed nearly 15% to $37.18 in early trading.
Chief Executive Paul Mahoney said demand for reliable prime power that does not require grid connection — supporting AI and digital infrastructure development — continues to grow. Hyperscale data centres face major grid delays, and Enerflex, drawing on three decades of industrial power-generation expertise, supplies off-grid natural gas, electricity and dedicated cooling systems.
On its second-quarter 2026 earnings call, the company disclosed that its distributed-power pipeline has expanded beyond 7GW across data-centre and power applications, with commercial teams in direct talks with hyperscalers and prime-power developers over the first 2GW.
On the technology side, Enerflex’s CCHP systems capture engine exhaust heat and convert it into chilled water, delivering 24/7 power and cooling in a single package. Its fast-start natural-gas engines match diesel load-acceptance speeds while avoiding diesel’s fuel management and heavy emissions.
On market size, annual data-centre capital expenditure is projected to exceed $300 billion through 2030; Enerflex estimates an addressable market of roughly $15 billion for its reciprocating gas-engine power blocks.
On fundamentals, roughly 65% of Enerflex’s revenue is recurring, and its engineered-systems backlog stood at $1.5 billion at the end of the second quarter, providing longer-term earnings visibility.
On valuation, Enerflex trades at a forward price-to-earnings ratio of about 12x and a forward PEG of about 0.3. A PEG well below 1 typically indicates a stock that may be significantly undervalued relative to its future earnings-growth trajectory.
The uncertainties are just as clear: the counterparty is unnamed, financial terms are undisclosed, and deliveries do not begin until 2027. With shares up roughly 300% over the past three years, whether the AI power story converts into actual 2027–2028 deliveries will hinge on order execution and conversion ahead.
