Homer City site: Large gas-fired power plant to support data center

The site of the former Homer City power station will be transformed into a natural gas-fired plant, generating electricity for the transmission grid and what is being called the state’s largest data center campus, it was announced Wednesday.

Developers called it a $10 billion project for the future.

“It is going to be an economic boost that this county has not seen in a while,” said Indiana County Commissioner R. Michael Keith, board chairman.

The project is expected to generate about 3,500 jobs during the construction period, said Kevin Adkisson, field operations director for the North American’s Building Trades Unions, which signed a labor agreement with Kiewit Power Constructors Co. of Omaha, Neb., the contractor for the project. The site will be home to about 1,000 permanent jobs, said David Marko, labor relations director for Kiewit.

The announcement of the economic development booster for the county comes about two years after Homer City Generation, which owned the coal-fired plant, announced it would shut down the state’s largest operation of its kind in July 2023.

The new 4.5-gigawatt power plant will be the largest natural gas-fired power producer in the nation, according to Homer City Generation LLC, which owns the 3,200-acre site. The plant and the data center are expected to be completed in two years. The first of the seven turbines that will create the power is expected to be delivered next year, according to Homer City Generation.

By comparison, Tenaska Westmoreland’s natural gas-fired power plant generates 925 megawatts of power, less than one gigawatt, and cost some $500 million to develop in South Huntingdon, Westmoreland County.

“This will be the largest capital investment ever to be brought to the Commonwealth of Pennsylvania,” said state Sen. Majority Leader Joe Pittman, R-Indiana.

Pittman helped to shepherd a $5 million grant from the Redevelopment Assistance Capital Program grant to extend a natural gas pipeline from the Blairsville area five miles to the site of the plant in Center Township.

The power plant and data center represent “an unprecedented level of economic opportunity” for Indiana County, the state and Mid-Atlantic region, said William Wexler, president of Homer City Redevelopment, in a statement. The power plant will have sufficient generating capacity to serve multiple large data center customers and supply power to thousands of homes.

A data center is a facility that houses computing equipment, such as servers, storage systems and networking devices, for organizations. They are critical infrastructure that keep the internet running by providing storage of digital information.

A data center also is being planned for Upper Burrell in Westmoreland County, at a vacant portion of the Arconic plant site.

The new plant, just like the coal-fired plant, will have connections to the PJM Interconnections transmission lines serving 13 states, as well as the New York Independent System Operator power grid, at a time when there is an increased demand for power.

“With ongoing increases in demand and tightening supply, keeping current resources online and redeveloping or restarting retired generation is important to maintaining grid reliability and affordability,” said Jason McGovern, a spokesman for PJM.

Homer City Redevelopment will receive financial support from Knighthead Capital Management LLC, a New York City-based private equity firm. The firm has been working with Homer City Redevelopment for about two years, said Andrew Shanahan, a partner in Knighthead Capital Management.

The site is being cleared of the remnants of the smokestacks and chimneys, most of which were demolished March 22. Shanahan said the site is uniquely situated to sustain and support building the plant and the data center, as well as other emerging technologies that demand power.

“This is our future,” Keith said.