From Coal to Cloud: Pennsylvania Power Plant to Become $10B Gas-Fueled Data Hub

A major investment in AI infrastructure is underway in Pennsylvania, USA where the former Homer City Generating Station—once the state’s largest coal-fired power plant—is set to become a $10 billion data center complex powered by natural gas.

The project, led by investor group Homer City Development, will repurpose the site, located approximately 50 miles east of Pittsburgh, into a high-capacity tech campus featuring seven gas turbines. These turbines will generate up to 4.5 gigawatts of electricity, enough to power 3 million homes, making it the largest gas-powered facility in the U.S. and the third-largest power producer nationwide, behind Washington’s Grand Coulee Dam and Georgia’s Plant Vogtle nuclear station.

Construction is expected to begin this year, with parts of the facility projected to go online by 2027. The total cost may exceed the initial $10 billion investment by several billion more, according to the developers.

Repurposing Existing Infrastructure

One of the key advantages of the project is the extensive infrastructure already in place from the previous plant, including transmission lines, substations, and water access. The site is already connected to the Mid-Atlantic and New York power grids, reducing the time and investment needed for upgrades.

The project also received a $5 million state grant to extend a natural gas pipeline to the location, which sits atop the prolific Marcellus Shale and near major interstate gas pipelines. The turbines will also be capable of operating on a hydrogen blend, supporting future energy diversification.

AI Surge Drives Power Demand

The shift comes amid a global surge in demand for computing power driven by the rapid expansion of AI and cloud services. The 2022 launch of ChatGPT, powered in part by Microsoft’s data infrastructure, highlighted the growing need for reliable, high-output energy sources to support generative AI systems.

This growing demand has pushed tech companies to seek new energy solutions and has prompted a renewed interest in nuclear and gas-fired power. It has also led to delays in planned plant retirements and even the revival of previously closed sites, such as the Three Mile Island nuclear plant, which is set to reopen to supply Microsoft’s data centers under a 20-year deal.

Economic and Strategic Significance

Pennsylvania State Senate Majority Leader Joe Pittman, whose district includes the Homer City site, called it the largest private capital investment in the state’s history.

Although the primary purpose of the new facility is to support AI and cloud computing infrastructure, developers say the plant may also provide surplus power to the wider grid, though specifics on clients or power distribution are yet to be disclosed.

The Homer City coal plant was officially shut down in 2023 after 54 years of operation, largely due to increasing environmental regulations, rising coal prices, mild winters, and competition from cheaper natural gas.

Now, its rebirth as a clean, tech-forward power center marks a symbolic shift—from legacy energy to the digital age.