PPL and Blackstone form joint venture to build gas plants for data centers

ALLENTOWN, Pa. - PPL Corporation (NYSE:PPL), a $25.75 billion utility company with a strong track record of 55 consecutive years of dividend payments, and Blackstone Infrastructure announced Tuesday they have formed a joint venture to build and operate new gas-fired power plants specifically designed to meet growing data center electricity demands through long-term energy supply agreements. According to InvestingPro data, PPL maintains a GOOD overall financial health score, positioning it well for this significant expansion.

The 51/49 partnership, with PPL holding the majority stake, aims to develop generation facilities in Pennsylvania atop the Marcellus and Utica shale basins where significant gas pipeline capacity is available. The venture will target areas with high data center interest and seek to establish long-term energy services agreements (ESAs) with hyperscale data center operators.

"We’re excited to leverage the powerful expertise that PPL and Blackstone Infrastructure possess to bring much-needed new dispatchable generation online in Pennsylvania," said PPL President and CEO Vincent Sorgi in the press release.

The announcement comes amid PJM Interconnection’s forecast of potential capacity shortages as early as the 2026-27 delivery year. Within PPL Electric Utilities’ service territory alone, data center interest has reached over 60 gigawatts of potential projects, with over 13 GW in advanced stages of planning.

According to the companies, the joint venture has secured multiple land parcels to enable the generation buildout, though no energy service agreements with hyperscalers have been signed yet. The partnership does not include PPL Electric Utilities or PPL’s other regulated subsidiaries.

Pennsylvania Governor Josh Shapiro expressed support for the initiative, stating it aligns with his "all-of-the-above energy" approach.

The companies indicated the joint venture is designed to have regulated-like risk profiles that avoid exposure to merchant energy and capacity price volatility, while helping to address resource adequacy concerns within the PJM market. This aligns well with PPL’s historically low volatility profile, evidenced by its beta of 0.65. InvestingPro analysis reveals the company has maintained steady revenue growth of 5.62% over the last twelve months, with multiple additional financial metrics available to subscribers.

Both partners emphasized that meeting the unprecedented demand growth from data centers will require multiple approaches, including the pending Pennsylvania legislation that would allow utilities to invest in, own and operate generation again. With PPL trading near its 52-week high and showing a P/E ratio of 25.4, investors seeking deeper insights can access comprehensive analysis through InvestingPro’s detailed research reports, which provide expert analysis on this and 1,400+ other US stocks.

In other recent news, PPL Corporation reported impressive financial results for the first quarter of 2025, exceeding analysts’ expectations. The company achieved earnings per share (EPS) of $0.60, surpassing the forecasted $0.52, while revenue reached $2.5 billion, significantly beating the anticipated $1.84 billion. This strong performance was supported by increased returns on capital investments and higher sales volumes. Despite these positive results, PPL’s stock saw a slight decline in pre-market trading, reflecting broader market trends rather than the company’s earnings performance. The company continues to focus on infrastructure and innovation projects, with strategic investments driving growth. PPL is targeting 6-8% annual EPS growth through 2028, supported by a robust pipeline of infrastructure projects. Recent regulatory approvals in Kentucky and Rhode Island further strengthen PPL’s position, with plans for new generation resources and infrastructure investments. Additionally, the company is seeing increased interest from data center developers in its service territories, indicating potential future growth opportunities.

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