Blackstone Energy Transition Partners, affiliated with the private equity giant Blackstone, has signed a definitive agreement to acquire the Hill Top Energy Center, a 620MW natural gas power plant in Western Pennsylvania, from private investment company Ardian for nearly $1 billion. The transaction underscores a strategic pivot in the energy sector, as electricity consumption in the region rises, driven by data centre development and other industrial use cases.
Completed in 2021 and situated in Greene County, Hill Top is touted as one of the most efficient combined cycle gas turbine plants in the US. The acquisition aligns with Blackstone’s July announcement to invest over $25 billion in Pennsylvania’s digital and energy infrastructure, aiming to bolster AI and stimulate an additional $60 billion in funding into the Commonwealth. Santander and Houlihan Lokey acted as financial advisors to Blackstone Energy Transition Partners, while Kirkland & Ellis served as legal advisor for the transaction.
“The electricity infrastructure required to power the AI revolution requires a tremendous amount of capital,” said Bilal Khan, senior managing director of Blackstone Energy Transition Partners, and Mark Zhu, managing director. “We are proud to make our latest investment in this sector – which is among our highest conviction investment themes – in Western Pennsylvania. Hill Top is among the best-in-class and a highly efficient modern power generation facility that is exceptionally well-positioned to help Pennsylvania and the region serve as a key centre of AI innovation.”
This move comes as the US experiences a resurgence in electricity demand after years of flat growth, attributed to industrial onshoring, widespread electrification, and the proliferation of AI data centres. These data centres are the leading drivers of demand growth, creating new opportunities for investors in natural gas-fired generation. Earlier this year, Blackstone Energy Transition Partners agreed to acquire the 774MW Potomac Energy Center in Loudoun County, Virginia, further solidifying its commitment to the sector.
The acquisition of Hill Top Energy Center is poised to shape the development of the energy sector by addressing the growing power needs linked to data centre development and other industrial use cases. As the region positions itself as a hub for AI innovation, the investment in efficient, natural gas-fired power generation could set a precedent for future infrastructure projects. The transaction also highlights the increasing role of private equity in driving energy transitions and the strategic importance of Pennsylvania in the evolving energy landscape.