Abu Dhabi fund ADIA invests $500 million in US power firm AlphaGen

Electricity
Electricity pylons. (Image: Freepik)

The Abu Dhabi Investment Authority (ADIA) will invest $500 million in Alpha Generation (AlphaGen), a U.S. power infrastructure company owned by private equity firm ArcLight Capital Partners.

The Investment remains subject to regulatory approvals and is expected to close in the first half of 2025.  

The portfolio, one of the largest independent power assets in the U.S., spans over 11 gigawatts (GW) of capacity, positioned in key markets poised to benefit from surging demand for energy.

AlphaGen operates one of the largest independent power portfolios in the US, managing over 11 gigawatts of capacity across six states. “This investment, and the partnership between ourselves and ADIA, will help catalyze both the future growth of, and the value of, this strategic portfolio of assets,” said Angelo Acconcia, partner at ArcLight, told Reuters.

This strategic deal underscores the growing convergence of two significant trends: the rapid rise of AI-driven data centers and the ongoing global push for electrification. As power demand intensifies across industries, AlphaGen’s infrastructure is uniquely positioned to address the long-term energy needs of critical sectors, particularly in supporting the expanding AI and data center ecosystem.

Curt Morgan, CEO of AlphaGen, said: “We are excited about the future potential of this portfolio, which is well positioned to deliver safe, reliable, and dynamic power solutions to meet increasing demand,” said Morgan.

AlphaGen focuses on providing sustainable, reliable, and secure power infrastructure to meet the growing demands of electrification. The company manages around 14,000 megawatts of power infrastructure across four RTO markets (PJM, NYISO, ISONE, and CAISO), operating 22 generation facilities spread across six states in the United States.

Key Highlights

  • ADIA is investing $500 million minority investment in AlphaGen, one of the U.S.’s largest independent power portfolios.
  • The portfolio encompasses over 11 GW of power assets located in vital markets across the U.S.
  • The investment taps into the rising demand for energy driven by AI development and electrification trends, crucial for powering data centers and local industries.
  • ArcLight brings extensive experience with over 65 GW of assets and 47,000 miles of electric and gas transmission infrastructure.

“This transaction presented an opportunity to expand our existing relationship with ArcLight, which has a long history of successfully investing in power infrastructure and is well positioned through this portfolio to provide the reliable electricity required by AI data centers and local industries,” said Khadem AlRemeithi, executive director of the Infrastructure Department at ADIA.

ADIA, founded in 1976, is one of the world’s largest sovereign wealth funds. It focuses on generating long-term value for the Government of Abu Dhabi through a diversified investment strategy.

“ArcLight is excited to expand its existing relationship with ADIA through this partnership, which will help catalyze the future growth and value of the AlphaGen portfolio and take advantage of the significant market opportunity,” said Angelo Acconcia, Partner at ArcLight.

ArcLight Capital Partners has been a leader in infrastructure investments since 2001, managing a diverse portfolio that spans power, hydro, solar, wind, battery storage, and transmission infrastructure.

Andrew Brannan, Managing Director at ArcLight, added that the portfolio was strategically built to address the growing power demand across the country. “These power assets, selectively acquired over time, aggregate a strategic portfolio that serves an important market need.”

Solar and wind energy
Solar and wind energy. (Image: Freepik)

ArcLight has a proven track record in managing power infrastructure assets. Since 2001, it has owned or operated nearly 65 GW of energy assets, including electric and gas transmission systems valued at approximately $80 billion. This latest partnership with ADIA is poised to support the continued expansion of AlphaGen’s infrastructure portfolio, which stands at the heart of the nation’s electrification efforts.

As the world increasingly turns to AI, data centers are experiencing unprecedented growth, contributing to a surge in energy demand. ArcLight’s leadership in the sector and its comprehensive technical and strategic expertise position AlphaGen to capitalize on this opportunity.

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