Data center investors want to buy Ohio's public utilities

BlackRock, the world’s largest asset manager, recently bought Minnesota Power. Now, it’s part of a $10 billion deal to buy AES Corporation, the parent company of AES Ohio. That raises a difficult question for Ohio regulators: Can they protect customers when AES’ new owners have financial interests on several sides of the electricity business? AES said the sale would provide urgently needed capital as utilities spend billions to meet soaring electricity demand. Consumer advocates see a troubling collision. They worry putting electric utilities and their biggest customers under the same investment umbrella could create conflicts that leave ordinary customers paying more. BlackRock holds shares in more than 5,000 companies, including data center operators and businesses that sell equipment to utilities. Its partner in the deal, Swedish investment firm EQT, brings another sprawling portfolio.“It’s extremely troubling from the point of view of the public,” said Joshua Basseches, a Case Western Reserve University professor who studies energy and climate policy. “I would say sketchy is a good word for it.”The case for sellingAES said the deal would give it something electric utilities increasingly need: Money. Electricity demand is growing, driven in large part by data centers, and needs about $2 billion through 2030 to keep up. But AES bet big on renewable energy. Then President Donald Trump and congressional Republicans rolled back tax breaks for new wind and solar projects as part of the One Big Beautiful Bill. AES’ stock price plummeted along with its credit rating in June 2025, and the company decided it would be better off going private. That’s where private equity came in. BlackRock’s Global Infrastructure Partners, EQT and the Qatar Investment Authority worked out a deal to buy the utility. BlackRock would control 57% of the company, Swedish investment firm EQT would own about 33% and Qatar would own the remaining 10%.

“We believe this transaction maximizes value for existing stockholders and positions the company for long-term success,” AES President Andrés Gluski said in a statement. AES customers won’t have to pay the costs of the deal, according to the company, and AES Ohio would still need PUCO approval for rate increases. For BlackRock, the deal is part of a bigger bet on infrastructure. In 2024, it bought Global Infrastructure Partners, an investment firm with stakes in airports, pipelines, power systems and data centers around the world. The purchase gave BlackRock a bigger foothold in what the industry calls real assets—the physical infrastructure people and businesses rely on every day. BlackRock sees money to be made there. CEO Larry Fink has called infrastructure a major long-term investment opportunity, driven by the enormous amount of electricity and construction needed to support artificial intelligence. Who keeps watch? Consumer advocates worried the public interests of AES Ohio’s 539,000 customers could take a back seat to investor profits. “Private equity companies are notorious for trying to squeeze as much profit as possible out of the companies they own,” said Nichole Heil, a researcher with the Private Equity Stakeholder Project. The nonprofit studies large asset managers and pushes for more transparency around their investments. In her search into BlackRock’s interest in AES, Heil found pitch materials from GIP suggesting investors could earn as much as 20% on their investment.“Where does private equity try to squeeze profits out of these utilities?” Heil asked. “The most glaring place is rates.” PESP pointed to northern Michigan, where a private equity fund bought Upper Peninsula Power Company in 2014. Two years later, the Detroit Free Press was reporting that UPPCO had some of the highest rates in the country. The utility said serving a small number of customers spread across a large rural area made electricity more expensive. But nearby Cloverland Electric Cooperative charged residential customers half as much.

Michigan regulators approved those increases, and that worried consumer advocates who questioned whether state regulators can effectively oversee investors this large and complicated. BlackRock manages $15.3 trillion in assets, and EQT is the largest shareholder in EdgeConneX, a data center company fighting to build a large campus in Ashville, south of Columbus.“How are regulators going to be able to track and manage these in a way that does not harm customers?” Heil said. Ohio also doesn’t have the best track record when it comes to keeping powerful utilities from exerting outsized influence over regulators. In 2021, FirstEnergy admitted to bribing former PUCO Chairman Sam Randazzo and then-Republican Ohio House Speaker Larry Householder. Calls for safeguards PJM’s Independent Market Monitor has asked Federal Regulatory Energy Commission to require several changes before approving the deal. One would prevent BlackRock from taking AES power plants off the regional grid to serve its data centers. With PJM already short on power, the monitor said this would tighten supplies and push prices even higher. The monitor also wanted BlackRock to choose between two roles. It could hold stakes in multiple power companies as a passive investor, or it could control companies like AES. The monitor said it shouldn’t be allowed to do both. At the state level, Basseches, the Case Western Reserve University professor, wanted the PUCO to mandate public reporting after AES goes private.