Aon Managing Director Peter Kapler shared that an $8 billion project generally cannot feasibly be supported by an $8 billion performance bond in the current market. That is not a legal prohibition but a function of how much risk any surety, or group of sureties, is willing to hold against a single project, and at the scale megaprojects have reached in 2026, that limit is now a real planning constraint. Aon frames the example around project scale generally; applying it to a data center campus specifically is this article's extension, not Aon's own example.
Aon's North America Contract Surety practice describes the shift plainly: as project sizes increase, the market is moving away from the traditional structure under which performance and payment bonds can each equal 100% of the contract value. The industry remains well capitalized overall, with strong premium growth and comparatively low loss ratios. But beneath that healthy headline, large global contractors carrying multi-market backlogs are beginning to hit the limits of their own aggregate bonding capacity, particularly when several megaprojects are moving through construction at once.
Why an $8 Billion Project Can't Get an $8 Billion Performance Bond
The pressure is not coming from a wave of contractor failures. It is coming from concurrency. Aon identifies simultaneous investment across transportation, water and wastewater, civil infrastructure, energy, battery plants, and data centers as drawing on the same finite pool of specialist labor, the same supply chains, and, critically, the same surety capacity, all at once. When those programs run in parallel rather than in sequence, performance security stops being a project-by-project line item and becomes a portfolio-level capital allocation problem for contractors, owners, and their financing counterparties.
That reframing matters for how deals get structured. Aon notes that owners and contractors are increasingly reconsidering excessive security requirements: an owner that demands more bonding than a project's risk profile justifies may not gain proportionately greater certainty. Instead, that owner can consume capacity a contractor needs across its broader backlog, and in a market where that capacity is already scarce, an oversized bond request can make a project harder to staff with a credible builder rather than safer.
North America Accounts for Half of the Global Surety Market, and Data Centers Are Straining It
Aon cites North America as representing approximately 50% of global surety market share, a metric based on premium volume rather than deployable capacity directly, which still concentrates the industry where major data center, power, and infrastructure programs are accelerating. McKinsey has estimated that data centers could require up to $6.7 trillion in cumulative global capital spending through 2030, including roughly $5.2 trillion for AI workloads and $1.5 trillion for traditional IT workloads. Not all of that spending will require surety support, but a meaningful portion of the associated construction work will create added demand for performance bonds, bank credit, and guarantees drawing on the same regional capacity.
Data centers also draw on a broader set of instruments than a typical infrastructure project. During construction, traditional performance bonds and, in North America, subcontractor default insurance cover completion risk. Once a facility moves into operation, financial guarantees tied to grid interconnection agreements and long-term power purchase agreements take over, and those obligations often require on-demand instruments that can be drawn within days rather than the slower-moving conditional bonds used elsewhere in construction. On-demand guarantees and traditional performance bonds do not necessarily come from the same provider or underwriting facility, but Aon advises treating them as competing uses of a developer's finite credit, liquidity, and risk-transfer capacity, which means construction-phase and operations-phase security needs are now competing with each other inside the same firm.
Reinsurance Treaty Terms Are Quietly Setting the Limit on Primary Bonding
A significant portion of the capacity available to contractors is influenced by a smaller, less diversified pool of reinsurance capital. Primary surety appetite is shaped by reinsurance treaty terms and reinsurer risk tolerance as much as by the fundamentals of any individual project, which means constraints can build up well before they become visible to a contractor asking for a bond. Recent losses in renewable energy have already made reinsurers more cautious, and that caution flows downstream into how much primary capacity insurers are willing to deploy on the next large solar, wind, or grid-connected project competing for the same treaty support.
Regional differences compound the effect. Aon points to rising insolvencies in parts of Europe and Australia, and UK Insolvency Service data show construction accounted for 17% of company insolvency cases in England and Wales for which industry was recorded during the twelve months ending June 2025, the highest share of any sector. That has made underwriters more selective even as North American pipelines stay strong. Tighter bank capital requirements in Europe are also pushing some developers toward surety as an alternative to bank guarantees, adding demand onto a capacity pool that was not built to absorb it, though bank guarantees and surety bonds draw on related rather than identical capital channels.
How Co-Surety and Subcontractor Default Insurance Are Extending Available Protection
Contractors and sureties are adapting through structural changes rather than simply raising prices. Co-surety and syndicated surety programs, where several insurers share a single large bond, are becoming more common as a way to spread exposure across markets rather than concentrating it with one carrier. Subcontractor default insurance, available mainly in North America, is drawing more interest from general contractors and construction managers who want it alongside a prime performance bond, since it can reduce reliance on subcontractor-level bonds and give the contractor more direct control over subcontractor-default claims. It does not give an owner the same protection as a performance bond covering the prime contractor, and it is not a substitute for one.
None of this is unique to insurance. Contractors are already stretching to cover construction backlogs against a shrinking skilled trades workforce, and the same megaprojects are running into power, water, and permitting constraints tightening at the same time. Bonding capacity is simply the latest input joining that list, and it is one finance teams have historically treated as a formality rather than a planning variable.
IIJA's Final Authorization Year Adds Another Source of Demand
A separate pressure is building underneath the megaproject story. Fiscal year 2026 is the final year of the Infrastructure Investment and Jobs Act's five-year surface-transportation authorization, and agencies continue to obligate and deploy funds across major public works programs. There is no single universal deadline governing this: availability and obligation periods vary by program, and some IIJA funding remains available beyond fiscal 2026 rather than expiring all at once. Even so, the continuing pipeline of federally supported transportation, water, energy, and broadband projects is adding to the public-sector construction backlog at the same time private data center, manufacturing, and power projects are competing for contractors and performance-security capacity, tightening bonding capacity further in states with the largest infrastructure spending even as underwriting reviews grow more rigorous across the board.
For finance teams sizing a data center, power, or industrial project, the practical takeaway is not that bonding will become unavailable. It is that treating performance security as a late-stage contractual detail, addressed after commercial terms are already set, now carries real execution risk. Grid interconnection guarantees, power purchase obligations, and construction-phase bonds can all consume parts of an organization's finite credit, liquidity, and performance-security capacity, even when the instruments are issued through different markets, and organizations that plan for that early are simply better positioned to get a megaproject financed, bonded, and built without a capacity shortfall showing up midway through. That is a shift in how capital planning has to work, not a shift separate from the broader convergence of energy, compliance, and supply chain pressure already reshaping how these projects get underwritten.
