Introduction
The General Services Administration (GSA), which manages government buildings, has recently announced a significant nuclear energy contract. This deal comes on the heels of several prominent tech companies making major nuclear energy deals last year. The 10-year, $840 million contract is for 10 million megawatt-hours of electricity, equivalent to what’s needed for more than 1 million homes annually.
Key Points
- Contract Details: The GSA awarded the contract to Constellation, which operates the nation’s largest nuclear fleet.
- Electricity Demand: The agency needs this amount of electricity for its buildings and other facilities.
- Nuclear Energy Share: About 4 million megawatt-hours of electricity will come from nuclear power plants.
Industry Trends
Silicon Valley is increasingly turning to nuclear energy to meet the growing demand for electricity from AI data centers. The federal government is the nation’s largest energy consumer, making this contract a significant boon to the nuclear industry.
Industry Quotes
"’This agreement is another powerful example of how things have changed,’" said Joe Dominguez, Constellation president and CEO. "’Frustratingly…nuclear energy was excluded from many corporate and government sustainable energy procurements. Not anymore.’"
Company Background
Constellation generates 10 percent of the nation’s carbon pollution-free energy. A majority of its output is nuclear energy, but it also produces hydro, wind, and solar power. The company aims to reach 100 percent carbon-free electricity by 2040.
Constellation’s Goals
- Carbon-Free Electricity: Reach 100% carbon-free electricity by 2040.
- Current Output: Generates 10% of the nation’s carbon pollution-free energy.
Government Response
The GSA is framing this contract as a way to lock in more affordable prices due to increasing electricity demand and competition for limited clean energy sources. The deal provides federal agencies with budgetary stability and protections from future price increases by keeping their electricity costs fixed for 10 years.
Government Quotes
"’This historic procurement locks in a cost-competitive, reliable supply of nuclear energy,’" said GSA administrator Robin Carnahan. "’We’re demonstrating how the federal government can join major corporate clean energy buyers in spurring new nuclear energy capacity and ensuring a reliable, affordable supply of clean energy for everyone.’"
Industry Impact
The contract will allow Constellation to extend licenses for existing nuclear power plants as well as invest in new equipment and technology that should result in 135 megawatts of additional capacity. The GSA agreed to purchase 2.4 million megawatt-hours of electricity from this added capacity over 10 years.
Contract Details
- Duration: 10 years
- Cost: $840 million
- Capacity: 135 megawatts
Related Developments
Google, Meta, Amazon, and Microsoft have all made splashy nuclear energy deals over the past year. In September of last year, Microsoft and Constellation announced a plan to restart a shuttered reactor at Three Mile Island in Pennsylvania.
Industry Deals
- Microsoft: Restarting a shuttered reactor at Three Mile Island.
- Google, Meta, Amazon: Made splashy nuclear energy deals over the past year.
