The US authorities introduced a ‘historic’ nuclear power deal

The Normal Companies Administration (GSA), which manages authorities buildings, simply introduced a significant nuclear power contract. The announcement comes on the heels of a number of huge tech firms making a flurry of nuclear power offers final yr.

The ten-year, $840 million contract is for 10 million megawatt-hours of electrical energy, which the GSA says is the equal of what’s wanted for greater than 1 million properties yearly. The company awarded the contract to Constellation, which operates the nation’s largest nuclear fleet, and lately introduced an settlement with Microsoft to restart a nuclear reactor at Three Mile Island. Nuclear power makes up a good portion of the GSA deal, about 4 million megawatt-hours, in response to Constellation spokesperson Paul Adams.

Silicon Valley is more and more turning to nuclear power to satiate rising electrical energy demand from AI information facilities. The federal authorities is the nation’s single largest power client, making this contract a giant boon to the nuclear trade.

“Frustratingly … nuclear power was excluded from many company and authorities sustainable power procurements. Not anymore. This settlement is one other highly effective instance of how issues have modified,” Joe Dominguez, Constellation president and CEO, mentioned in a press launch. “The USA authorities joins Microsoft and different entities to assist continued funding in dependable nuclear power that may enable Constellation to relicense and prolong the lives of those essential property.”

Constellation says it generates 10 p.c of the nation’s carbon pollution-free power. A majority of its output is nuclear power, however it additionally produces hydro, wind, and solar energy. It additionally generates electrical energy from gas-fired energy crops, though the corporate has set a objective of reaching one hundred pc carbon-free electrical energy by 2040 in comparison with near 90 p.c at present.

Constellation and the GSA declined to reply questions on how a lot of the electrical energy included within the contract will come from every supply except for nuclear energy crops. Altogether, it’s the largest power procurement contract the GSA has signed in its historical past.

“This historic procurement locks in a cost-competitive, dependable provide of nuclear power,” GSA administrator Robin Carnahan mentioned in a press launch. “We’re demonstrating how the federal authorities can be a part of main company clear power patrons in spurring new nuclear power capability and guaranteeing a dependable, reasonably priced provide of fresh power for everybody.”

The contract will enable Constellation to increase licenses for current nuclear energy crops in addition to “spend money on new tools and expertise” that ought to lead to 135 megawatts of extra capability. The GSA agreed to buy 2.4 million megawatt-hours of electrical energy from that added capability over 10 years. Outdoors of GSA buildings, the deal additionally extends to 13 different businesses, together with the departments of Veterans Affairs and Transportation in addition to the Federal Bureau of Prisons, the Nationwide Park Service, the Social Safety Administration, and the US Mint.

The GSA is framing the contract as a option to lock in additional reasonably priced costs as information facilities drive up electrical energy demand and improve competitors for restricted clear power sources:

Within the face of uncertainty over future electrical energy costs and rising electrical energy demand from information facilities and AI amenities, as an example, this contract gives federal businesses with budgetary stability and protections from future worth will increase by protecting their electrical energy prices mounted for 10 years, whereas additionally persevering with to bolster the home nuclear trade.

Google, Meta, Amazon, and Microsoft have all inked splashy nuclear power offers over the previous yr. In September of final yr, Microsoft and Constellation introduced a plan to restart a shuttered reactor at Three Mile Island in Pennsylvania, the positioning of the worst nuclear power accident in US historical past.

The Biden administration has additionally made nuclear power a key a part of its plan to transition the US away from fossil fuels to power sources that don’t trigger local weather change. Final October, the Division of Vitality introduced a $1.52 billion mortgage to assist restart a retired nuclear producing station in Covert Township, Michigan. And whereas President-elect Donald Trump plans to undo progress made towards clear power, the Trump marketing campaign agenda included efforts to “assist nuclear power manufacturing.”