Capital Power to Expand in PJM Power Market with $2.2 Billion Deal

Power Lines

Canadian power producer Capital Power Corp said on Monday it would buy two natural-gas fired power plant operators located in the PJM market for about $2.2 billion.
The deal comes at a time when electricity prices are rapidly increasing in PJM, the United States’ biggest power market, and as demand for electricity continues to increase on the back of the proliferation of energy-guzzling AI data centers and the electrification of transportation and buildings.

Capital Power said it would buy power plant operators Hummel Station Intermediate Holdings III and Rolling Hills Generating Holdings from LS Power Equity Advisors.

Hummel Station owns a 1,124 megawatt (MW) combined-cycle natural gas facility in Shamokin Dam, Pennsylvania, while Rolling Hills owns the 1,023 MW combustion turbine natural gas facility in Wilkesville, Ohio.

The acquisition will immediately add to adjusted funds from operations per share, Capital Power said, adding that upon completion the company would be positioned as one of five North American independent power producers with over 10 gigawatts of natural gas capacity.

Capital Power expects the acquisition to generate average annual adjusted EBITDA of about $443 million for the 2026-2030 period. It expects to close the transaction in the third quarter.

The power producer added it has commenced an offering of $500 million of its common stock, the gross proceeds of which would help finance the acquisition.

(Reporting by Vallari Srivastava in Bengaluru; Editing by Maju Samuel)

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