Blackstone backs new electric transmission company

Blackstone will provide financial support and oversight to GridLiance, a newly-formed company that will partner with public power utilities to develop, own and operate transmission infrastructure.

Blackstone Energy Partners, the energy-focused private equity business of the New York-based investment firm, is backing GridLiance, a company focused on collaborating with public power utilities to jointly plan, develop, own and operate transmission infrastructure.

Led by Ed Rahill, former chief financial officer of ITC Holdings, the largest independent electricity transmission company in the US, GridLiance was incorporated last year to enable municipal, cooperative and joint action agency utilities to invest in transmission infrastructure.

“Historically, transmission-dependent Public Power utilities have been unable to invest in – and financially benefit from – transmission projects because they lack the scale, planning infrastructure, regulatory influence and the engagement necessary to effectively participate in the Regional Transmission Organization (RTO) planning process,” – an area dominated by incumbent investor-owned utilities – the two companies said in a joint statement.

In addition to developing and owning new projects, GridLiance will also work with public power entities to identify existing transmission infrastructure that can be upgraded and integrated into the RTO. To that end, the new company is seeking to acquire and operate existing transmission lines and related facilities owned by utility companies that would prefer to divest such assets in order to focus on their core business.

The Kansas City, Missouri-based company has already entered into 30-year joint development agreements with the Missouri Joint Municipal Electric Utility Commission and the Oklahoma Municipal Power Authority.

“Under these agreements, GridLiance affiliates formed to operate in each of the Southwest Power Pool (SPP) and the Midcontinent Independent System Operator (MISO) regions have the exclusive right to jointly plan, construct and operate transmission infrastructure for these agencies,” according to the statement.

To date, Blackstone has invested approximately $8 billion of equity globally within the energy sector. In February, the firm closed its second energy fund, Blackstone Energy Partners II (BEP II), on $4.5 billion, beating its hard cap.

In addition to energy, the New York-listed investment firm invests in private equity, real estate, public debt and equity, non-investment grade credit, real assets and secondary funds. Blackstone currently has approximately $300 billion in assets under management.