Google signs 20-year nuclear power deal with Constellation for data centers

Google announced an agreement to upgrade six nuclear power plant sites in the US, The Verge reported on 6 October. The company signed a 20-year power purchase agreement with Constellation, which The Verge described as the leading nuclear power plant operator in the US. The deal is meant to guarantee the revenue needed to cover the cost of efficiency upgrades at existing nuclear plants and "represents more than $4.3 billion of new investment by Constellation," according to the press release cited by The Verge. MarketWatch reported that Constellation's stock is rising sharply following the deal.

The companies expect new equipment at each site to collectively lead to 890 megawatts of additional nuclear capacity over the next five years, which Google and Constellation said is roughly equivalent to one large new nuclear reactor or three small modular reactors. They plan to modernize 11 reactors at six sites in Illinois, Pennsylvania and New Jersey. Each site is connected to the PJM Interconnection grid, the largest power grid in the US, which spans 13 states and the District of Columbia.

Google also signed a separate, much larger 15-year energy supply agreement with Constellation, meant to guarantee continued revenue for other existing Constellation power plants within PJM regardless of fuel type, according to The Verge. At 2,700MW, that deal is much larger than the nuclear power purchase agreement. Nuclear energy made up 70 percent of Constellation's total generating capacity last year, renewables 8 percent, and gas and oil the remaining 22 percent, according to the company's latest sustainability report.

PJM has struggled to meet growing demand from AI data centers, according to The Verge. An independent market monitor filed a complaint last year with the Federal Energy Regulatory Commission (FERC) saying PJM was planning to allow large data centers to connect to the grid that it could not reliably serve, which could lead to blackouts. In January, the Trump administration and governors from all of the states where PJM operates issued a joint statement calling on PJM to hold an "emergency" power auction to support the buildout of new power plants through long-term contracts. PJM postponed its auction last week, after FERC directed it to revise its proposal to ensure stronger protections against data centers raising electricity bills for other customers.

Electricity rates have risen in states connected to PJM, including New Jersey, where prices have climbed 54 percent over five years, according to The Verge. Data centers are driving a surge in new gas infrastructure projects in the US, moving many tech companies further from their sustainability goals, The Verge reported. Google's carbon emissions rose by 18 percent last year along with a jump in electricity demand of 37 percent, according to the company's latest sustainability report.