PPL And Blackstone Join Forces To Build Gas Plants For Data Centers

PPL Corporation PPL shares saw modest gains in early Wednesday trading following the announcement of a strategic partnership with Blackstone Inc. BX to develop new gas-powered energy facilities tailored for data center operations.

The two firms unveiled a joint venture aimed at designing, constructing and operating combined-cycle natural gas plants across Pennsylvania. The facilities will deliver power to data centers under long-term energy service agreements (ESAs), offering stable returns while minimizing exposure to volatile merchant energy pricing.

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Vincent Sorgi, CEO of PPL, highlighted that this collaboration leverages the strengths of both entities to meet the growing energy demands of the digital economy.

“We’re excited to leverage the powerful expertise that PPL and Blackstone Infrastructure possess to bring much-needed new dispatchable generation online in Pennsylvania to match new data center load in a way that directly supports economic development and large load customer needs, helps to mitigate rising electricity prices for energy consumers, and delivers increased value for shareowners without traditional merchant power risk,” Sorgi said during the Pennsylvania Energy and Innovation Summit in Pittsburgh.

Blackstone Infrastructure will hold a 49% stake in the joint entity, with PPL retaining a 51% controlling interest. Both partners will share costs and profits proportionally.

The project will focus on locations near the Marcellus and Utica shale formations, leveraging existing pipeline access and the region’s strong interest in data centers.

PJM Interconnection has warned of potential energy shortfalls by 2026 due to aging infrastructure and surging demand from data-intensive industries, such as AI.

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In PPL’s own utility service area, developers have proposed more than 60 gigawatts of data center projects, including 13 GW in advanced planning. PPL forecasts a 6 GW capacity gap in five to six years, equivalent to roughly $15 billion in new investment needs.

While the joint venture represents a major step toward ensuring sufficient generation capacity, PPL noted that broader legislative action is still required. Pending bills in the Pennsylvania legislature aim to allow utilities to invest in and operate generation assets again, potentially unlocking further energy development across the state.

Pennsylvania Gov. Josh Shapiro praised the announcement, calling it a key investment in both infrastructure and job creation.

“Pennsylvania is competing again,” he said, citing the state’s diverse energy resources and role in driving technological advancement.

Price Action: PPL shares are trading higher by 0.40% to $35.49 premarket at last check Wednesday.

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