US Government Announces Historic Nuclear Energy Deal
Major Nuclear Energy Contract Signed by GSA
The General Services Administration (GSA), which manages government buildings, has just announced a significant nuclear energy contract. This announcement comes on the heels of several big tech companies making numerous nuclear energy deals last year.
10-Year, $840 Million Contract for 10 Million Megawatt-Hours of Electricity
The GSA has awarded a 10-year, $840 million contract to Constellation, which operates the nation’s largest nuclear fleet. This deal is for 10 million megawatt-hours of electricity, which is equivalent to what’s needed for more than 1 million homes annually. The agency has stated that this contract will provide federal agencies with budgetary stability and protections from future price increases by keeping their electricity costs fixed for 10 years.
Nuclear Energy Makes Up a Significant Portion of the Deal
According to Constellation spokesperson Paul Adams, nuclear energy makes up about 4 million megawatt-hours of the deal. This is a significant portion of the total 10 million megawatt-hours, and it highlights the importance of nuclear energy in meeting the country’s electricity demands.
Silicon Valley Turns to Nuclear Energy
The increasing demand for electricity from AI data centers has led Silicon Valley companies to turn to nuclear energy as a reliable source of power. The federal government is the nation’s single largest energy consumer, making this contract a big boon to the nuclear industry.
Constellation President and CEO Comments on the Deal
"This agreement is another powerful example of how things have changed," said Joe Dominguez, Constellation president and CEO, in a press release. "Frustratingly … nuclear energy was excluded from many corporate and government sustainable energy procurements. Not anymore. This agreement is another powerful example of how things have changed." He added that the United States government joins Microsoft and other entities to support continued investment in reliable nuclear energy.
Constellation’s Commitment to Carbon-Free Energy
Constellation generates 10 percent of the nation’s carbon pollution-free energy, with a majority of its output coming from nuclear energy. However, the company also produces hydro, wind, and solar power. It has set a goal of reaching 100 percent carbon-free electricity by 2040 compared to close to 90 percent today.
Electricity Generation Mix for Constellation
While 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 is clear that the company is committed to a diverse mix of renewable energy sources. This includes hydro, wind, and solar power, as well as gas-fired power plants.
The Largest Energy Procurement Contract in GSA History
This historic procurement locks in a cost-competitive, reliable supply of nuclear energy, according to GSA administrator Robin Carnahan. 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.
Contract Details
The GSA agreed to purchase 2.4 million megawatt-hours of electricity from the added capacity over 10 years. The contract will also extend to 13 other agencies, including the departments of Veterans Affairs and Transportation as well as the Federal Bureau of Prisons, the National Park Service, the Social Security Administration, and the US Mint.
Locking in More Affordable Prices
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. This contract provides federal agencies with budgetary stability and protections from future price increases by keeping their electricity costs fixed for 10 years.
Recent Nuclear Energy Deals
This deal comes on the heels of several big tech companies making numerous nuclear energy deals last year. Google, Meta, Amazon, and Microsoft have all inked splashy nuclear energy deals over the past year.
Microsoft and Constellation’s Partnership
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. This partnership highlights the growing importance of nuclear energy in meeting the country’s electricity demands.
The Biden Administration’s Plan for Nuclear Energy
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. Last October, the Department of Energy announced a $1.52 billion loan to help restart a retired nuclear generating station in Covert Township, Michigan.
Support for Nuclear Energy Across Parties
While President-elect Donald Trump plans to undo progress made toward clean energy, the Trump campaign agenda included efforts to "support nuclear energy production." This highlights the growing bipartisan support for nuclear energy as a reliable source of power.
