Coal-fired power plant, now retired, to become massive gas-powered campus for AI, data centers

The owners of what was once Pennsylvania’s biggest coal-fired power plant said Wednesday that they will turn it into a $10 billion natural gas-powered data center campus designed to capitalize on the fast-growing energy demands of Big Tech companies to power artificial intelligence and cloud computing applications.

The former Homer City Generating Station, about 50 miles (80 kilometers) east of Pittsburgh, will host seven gas-fired turbines to power data centers on site with up to 4.5 gigawatts of electricity, according to the owners, an investor group named Homer City Development.

That amount of electricity is enough to power about 3 million homes and would be the nation’s third-largest power generation facility after the Grand Coulee hydroelectric dam in Washington and the new Plant Vogtle nuclear power plant in Georgia, according to federal data.

Construction is expected to begin this year and power could start flowing by 2027, the group said in a statement. The cost to prepare the site and build the data centers could exceed the initial $10 billion investment by billions more, the group said. It could also supply electricity to the wider power grid, it said.

Much of the critical infrastructure for the project is already in place from the shuttered Homer City power plant, including transmission lines connected to the mid-Atlantic and New York power grids, substations and water access, the group said.

The developers were awarded a $5 million state grant to extend a gas line to the property, which sits atop the prolific Marcellus Shale natural gas reservoir.

Last month, the group demolished the three cooling towers and four smokestacks still standing from the former coal plant. It shut down in 2023 after 54 years in operation.

The owners, Homer City Development, blamed competition with cheaper natural gas, unseasonably warm winters that demanded less power, the rising cost of coal and increasingly expensive environmental regulations.

The late 2022 debut of OpenAI’s ChatGPT — built with help from Microsoft’s data centers — ignited worldwide demand for chatbots and other generative AI products that typically require large amounts of computing power to train and operate.

That has sent Big Tech companies in search of new power sources, spurred interest in a new wave of nuclear reactors, revived interest in building new gas-fired plants and stoked concerns among states and federal regulators about electricity shortages.

It’s also prompted utilities to delay the retirements of aging power plants and to bring nuclear power plants out of retirement, including last year’s announcement that the shuttered Three Mile Island nuclear power plant will reopen under a 20-year agreement to feed Microsoft’s data centers.

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Follow Marc Levy on X at: https://x.com/timelywriter.