Blackstone Buys 774 MW Virginia Gas Plant, Bets on Data Center Demand

Blackstone Buys 774 MW Virginia Gas Plant, Bets on Data Center Demand
'The Northern Virginia region currently represents approximately 25 percent of U.S. data center capacity, and the Potomac plant is located in close proximity to over 130 data centers – with significant further growth expected'.
Image by 1715d1db_3 via iStock

Blackstone Inc., through Blackstone Energy Transition Partners, has signed an agreement to acquire the Potomac Energy Center, a 774-megawatt (MW) natural gas power plant in Loudoun County, Virginia, to support growing power demand among data centers.

“The transaction represents Blackstone’s most recent investment in the power infrastructure supporting data centers and AI revolution – one of the firm’s highest-conviction areas”, Blackstone said in an online statement.

“The Northern Virginia region currently represents approximately 25 percent of U.S. data center capacity, and the Potomac plant is located in close proximity to over 130 data centers – with significant further growth expected”.

Blackstone did not disclose details of the transaction. Santander and Jefferies LLC served as advisors to the company.

“Potomac is one of the most efficient gas power plants in the region and has the potential to integrate a hydrogen fuel blend in the future, which could provide future environmental benefits”, said Mark Zhu, managing director at Blackstone Energy Transition Partners.

Blackstone claims to be the world’s biggest data center provider with a global portfolio.

CoreWeave Investment

Last year it committed support for AI developer CoreWeave. The $7.5 billion debt financing facility is “led by funds managed by Blackstone, with strategic participation from Magnetar (co-lead investor) and Coatue”, CoreWave said in a press release May 17, 2024. The other backers in the financing package include BlackRock, Carlyle, CDPQ, DigitalBridge Credit, Eldridge Industries and Great Elm Capital Corp.

“CoreWeave is building the infrastructure to power the AI innovations that are already changing how businesses operate in the global economy”, CoreWeave chief executive and co-founder Michael Intrator said then. “The caliber of investors in this large debt financing round is a powerful testament to both the insatiable market appetite for AI infrastructure and their belief in CoreWeave’s ability to deliver cutting-edge innovation for the largest AI labs and innovators at scale.

CoreWeave said, “The next era of computing will be driven by AI workloads that put tremendous demand on computational resources”.

“CoreWeave is uniquely positioned to fill a void in the cloud market by delivering the high-power infrastructure that these market-leading AI products require”, it added.

DDN Investment

Earlier this month it was announced that Blackstone invested $300 million in another AI firm, DDN.

“This investment enables us to execute our strategy to bring enterprise-grade AI solutions to companies of all sizes, transforming industries and delivering measurable outcomes”, Paul Bloch, president and co-founder of DDN, said in a statement January 9, 2025.

“DDN is laser-focused on solving real AI business challenges, from accelerating LLM deployments to enhancing inferencing, so our customers can unlock their data’s potential and achieve tangible ROI [return on investment] faster than ever”.

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