Apollo Global Management has formed a new partnership with Canadian utility Capital Power to target as much as $3bn of equity investments in US gas-fired power plants, as private capital accelerates its push into energy assets supporting the country’s data centre boom. 

Under the agreement, Apollo will provide about 75% of the capital, with Capital Power contributing the balance and taking a 25% to 50% working interest in each acquisition. The approach gives the power producer a standing partner for future deals, enabling faster execution in a highly competitive market.

Capital Power chief executive Avik Dey said the structure removes the need to source a co-investor for each transaction. “This allows us to go in with a preset partner with an understanding of chasing assets and a strategy together, while also accelerating returns,” he said.

Capital Power has prioritised US expansion as electricity demand surges from large-scale data centres. Forecasts from BloombergNEF show natural gas demand from US data centres rising to 6.8bn cubic feet a day by 2035, compared with 1.3bn last year. The company also announced a memorandum of understanding to supply power to an investment-grade data-centre developer in Alberta.

Shares of Capital Power slipped 1.6% in Toronto after the announcement.

The partnership highlights private equity’s growing influence in next-generation energy infrastructure as digital expansion reshapes power markets across North America.

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