Energy Capital to sell 2.6 GW gas plants to Talen Energy for $3.45 Billion

Talen Energy announced?on Thursday that it would purchase about 2.6 gigawatts of natural gas-fired generating capacity from private 'equity firm - Energy Capital Partners, for $3.45 Billion. This will double its annual production and strengthen its position in PJM markets in the Mid-Atlantic region and Midwest U.S.

In premarket trading, shares of Talen increased by about 10%.

The United States' power demand is expected to reach record levels by 2026. This will be driven by the rapid growth of AI and cryptocurrency data centers, as well as increased electrification in homes and businesses. This will force U.S. energy producers?to increase gas-fired generators.

The deal between Energy Capital and Talen includes the Waterford Energy Center and Darby Generating Stations in Ohio and the Lawrenceburg Power Plants in Indiana.

The deal, according to the power producer, comprises approximately $2.55 billion cash and $900 million worth of stock.

Talen's President Terry Nutt said that the Talen transaction would allow it to double its annual production in two years. It will also diversify our fleet and increase our cash flow per share.

Talen stated that the deal is expected to close by the second half 2026 and will immediately increase adjusted free cash flow per share of more than 15% each year through 2030.

The company had previously purchased two power plants for $3.5 billion in 2025 as part of its 'flywheel' strategy to expand capacity and serve hyperscale centers. (Reporting and editing by Krishna Chandra Eluri in Bengaluru)

(source: Reuters)