Adds details and background throughout

July 13 (Reuters) - Williams WMB.N said on Monday that a Blackstone BX.N-led consortium will invest $5.34 billion for a 49% noncontrolling stake in five of its power generation projects, providing the U.S. pipeline operator with capital to expand the business.

The consortium, which also includes Apollo and KKR KKR.N-managed vehicles, will contribute $4.4 billion toward the behind-the-meter projects, representing 49% of expected growth capital expenditures, along with about $900 million of additional consideration.

Surging power demand from AI and data centers is driving energy companies to build behind-the-meter projects that supply users directly, bypassing the grid, with private equity increasingly footing the bill to ease balance-sheet strain.

The deal covers Williams' Ohio projects — Socrates, Apollo, Socrates the Younger and Neo — along with Aquila, which are part of a broader pipeline of more than 6 gigawatts the company is developing.

Williams can buy back Blackstone's stake between years 7 and 14 based on the amount of Blackstone's investment that remains outstanding.

The company said the deal reduces its capital commitment and preserves balance-sheet capacity for more projects, while allowing it to retain commercial and operational control in support of its long-term leverage target.

It added the partnership will help fund expansion of its Power Innovation business, which has more than 2.6 gigawatts of announced projects.