Google/Alphabet (NASDAQ:GOOG) has contracted 3,590 megawatts of power from Constellation Energy (NASDAQ:CEG) within the PJM Interconnection, the largest U.S. power grid serving 67 million people across 13 states and Washington, D.C. Approximately a quarter of this supply, or 890 megawatts, will come from new nuclear energy.
The surge in artificial intelligence and data center expansion has significantly increased Google's electricity consumption and carbon emissions.
Major technology companies are actively securing substantial electricity supplies to power their data centers across the U.S. by entering into unprecedented power deals and contributing to the revival of the country's nuclear industry, according to Reuters. Unlike renewable energy sources, nuclear power provides a continuous base-load supply.
Data centers are inherently energy-intensive, with their global power consumption projected to double by 2030, reaching an estimated 945-980 terawatt-hours (TWh) annually. In some countries, such as the U.S., they could account for up to 12% of total electricity consumption by 2030, placing a strain on existing power grids.
The agreement between Google and Constellation involves adding capacity to several of Constellation's nuclear reactors in the Midwest and Mid-Atlantic regions.
"The 20-year power purchase agreement will enable investments in new equipment and technology at 11 Constellation-owned nuclear units in Illinois, Pennsylvania, and New Jersey, increasing thermal and electrical efficiency to unlock additional reliable, firm power to serve the grid," Constellation stated in a press release.
As part of the agreement, Constellation will invest over $4.3 billion in its fleet. Electricity from the first of the upgraded plants is expected to be delivered in 2028.
Reuters highlights that the deal between Google and Constellation is a response to PJM's "bring your own power" proposal:
Rising electricity demand, largely driven by data center expansion, has led to a more than eleven-fold increase in PJM capacity prices since 2024 and has resulted in a power shortfall for the grid.
In response, PJM management has proposed requiring data center customers connected to the 13-state grid to either provide their own power or face remote disconnection from grid power during peak demand periods.
The Google-Constellation deal is the latest in a series of nuclear power announcements involving the "Magnificent Seven" tech companies. Google has also contracted to restart NextEra Energy's (NYSE:NEE) nuclear power plant in Iowa. Constellation has agreed to restart its Three Mile Island reactor in Pennsylvania to serve Microsoft's (NASDAQ:MSFT) data centers.
Constellation announced on September 30th a 20-year power purchase agreement with Amazon (NASDAQ:AMZN) to supply 690 megawatts from its Calvert Cliffs nuclear plant in Maryland, and a 20-year virtual PPA with Meta (NASDAQ:META) for 1,121 MW of power.
In August, Oilprice reported that major data center operator Equinix (EQIX.O) announced a series of agreements to secure advanced nuclear electricity, including power purchase agreements and a pre-order for microreactors, to power its data centers. This move comes as the growing energy demands of data centers, fueled by technologies like generative artificial intelligence (AI), raise concerns about global power supplies.
According to a company statement, these agreements are part of Equinix's long-term strategy to ensure a stable and sustainable electricity supply for its global operations. The deals are expected to provide over one gigawatt of electricity to Equinix's data centers, a significant step as the company plans for future growth.
The United States accounts for approximately 30% of global nuclear electricity generation, making it the world's leading nuclear power provider. Other significant nuclear-generating countries include France, China, Russia, and South Korea.
The 94 operating reactors across commercial power plants generate about 782,000 gigawatt-hours (GWh) annually, supplying nearly 18-19% of the total electricity consumed in the country.
The most recent new nuclear reactor built in the U.S. is Vogtle Unit 4 in Burke, Georgia, which commenced commercial operation in April 2024.
