US Government Announces Historic Nuclear Energy Deal
A Significant Step for the Nuclear Industry
The General Services Administration (GSA), which manages government buildings, has recently announced a major nuclear energy contract. This development comes on the heels of several big tech companies making significant strides in nuclear energy deals last year.
A 10-Year, $840 Million Contract
The GSA has awarded a 10-year, $840 million contract to Constellation for 10 million megawatt-hours of electricity. According to the agency, this is equivalent to what’s needed for more than 1 million homes annually. The contract represents a significant portion of the federal government’s energy needs and underscores the growing importance of nuclear energy in meeting these demands.
Nuclear Energy Makes Up a Significant Portion
Nuclear energy makes up about 4 million megawatt-hours, or approximately 40% of the electricity generated under this contract. This is according to Constellation spokesperson Paul Adams, who notes that this is a significant portion of their overall output.
A Growing Trend in Silicon Valley
Silicon Valley is increasingly turning to nuclear energy to meet the rising electricity demand from AI data centers. As technology continues to advance and more businesses move into the region, the need for reliable and sustainable energy sources grows exponentially.
A Boon to the Nuclear Industry
The federal government is the nation’s single largest energy consumer, making this contract a significant boon to the nuclear industry. By investing in nuclear energy, the GSA is demonstrating its commitment to reducing carbon emissions and meeting the country’s growing energy needs.
A New Era for Nuclear Energy
According to Joe Dominguez, Constellation president and CEO, "This agreement is another powerful example of how things have changed. Frustratingly… nuclear energy was excluded from many corporate and government sustainable energy procurements. Not anymore." This contract marks a significant shift in the way the federal government approaches energy procurement and highlights the growing importance of nuclear energy.
A Commitment to Carbon-Free Energy
Constellation generates 10 percent of the nation’s carbon pollution-free energy, with a majority coming from nuclear power plants. The company also produces hydro, wind, and solar power, as well as electricity from gas-fired power plants. However, Constellation has set a goal of reaching 100 percent carbon-free electricity by 2040.
A Collaborative Effort
While the GSA and Constellation declined to answer questions about how much of the electricity included in the contract will come from each source aside from nuclear power plants, it’s clear that this is a collaborative effort between two major players in the energy sector.
A Historic Procurement
This contract marks the biggest energy procurement deal in GSA history. According to GSA administrator Robin Carnahan, "This historic procurement locks in a cost-competitive, reliable supply of nuclear energy." The contract will also allow Constellation to extend licenses for existing nuclear power plants and invest in new equipment and technology that should result in 135 megawatts of additional capacity.
A Reliable and Affordable Supply
The GSA is framing this contract as a way to lock in more affordable prices as data centers drive up electricity demand and increase competition for limited clean energy sources. By purchasing 2.4 million megawatt-hours of electricity from the added capacity over 10 years, federal agencies will have budgetary stability and protections from future price increases.
A Key Part of the Biden Administration’s Plan
The Biden administration has made nuclear energy a key part of its plan to transition the US away from fossil fuels to energy sources that don’t cause climate change. This contract is in line with the administration’s efforts to promote clean energy and reduce carbon emissions.
A Growing Trend Among Big Tech Companies
Google, Meta, Amazon, and Microsoft have all inked 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, the site of the worst nuclear energy accident in US history.
A Significant Step Forward
This contract is a significant step forward for the nuclear industry and marks a major shift in the way the federal government approaches energy procurement. By investing in nuclear energy, the GSA is demonstrating its commitment to reducing carbon emissions and meeting the country’s growing energy needs.
