- PPL Corporation (PPL, Financial) and Blackstone Infrastructure form a joint venture to build natural gas generation in Pennsylvania.
- The venture aims to address looming capacity shortages with a focus on powering data centers through long-term energy services agreements.
- Potential 6 GW generation shortfall in the next 5-6 years, requiring approximately $15 billion in investments.
PPL Corporation (PPL) and Blackstone Infrastructure have announced a strategic joint venture to develop and operate new gas-fired, combined-cycle generation stations in Pennsylvania. This initiative aims to provide energy support for data centers via long-term energy services agreements (ESAs). The partnership, owned 51% by PPL and 49% by Blackstone, addresses the predicted capacity shortages by PJM Interconnection starting 2026-27.
The venture responds to a growing demand within PPL Electric Utilities' service area, where there is over 60 GW of potential data center projects, with 13 GW currently in advanced planning stages. PPL estimates a significant 6 GW generation shortfall within the next five to six years, representing about $15 billion in investment needs.
Located strategically atop the Marcellus and Utica shale basins, the new gas plants capitalize on abundant natural gas supply and are designed to meet the substantial data center interest. The joint venture plans to secure revenue through regulated-like ESAs, insulating against merchant energy and capacity price volatility.
Although the venture is actively engaging with landowners, natural gas pipeline companies, and turbine manufacturers, and has secured multiple land parcels for development, no ESAs have been signed with hyperscalers to date. The project hinges on successful ESA executions and potential legislative support that might allow utilities to own and operate new generation capacities.
The collaboration highlights Pennsylvania's potential for energy and economic expansion, fostering job creation and leveraging AI and data center growth. As a forward-looking initiative, it seeks to tackle resource adequacy concerns while providing stable, long-term investment returns.
