The Basic Companies Administration (GSA), which manages authorities buildings, simply introduced a significant nuclear vitality contract. The announcement comes on the heels of a number of large tech firms making a flurry of nuclear vitality 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 not too long ago introduced an settlement with Microsoft to restart a nuclear reactor at Three Mile Island. Nuclear vitality 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 vitality to satiate rising electrical energy demand from AI knowledge facilities. The federal authorities is the nation’s single largest vitality shopper, making this contract a giant boon to the nuclear trade.
“This settlement is one other highly effective instance of how issues have modified.”
“Frustratingly … nuclear vitality was excluded from many company and authorities sustainable vitality procurements. Not anymore. This settlement is one other highly effective instance of how issues have modified,” Joe Dominguez, Constellation president and CEO, stated in a press launch. “America authorities joins Microsoft and different entities to help continued funding in dependable nuclear vitality that may enable Constellation to relicense and prolong the lives of those vital belongings.”
Constellation says it generates 10 p.c of the nation’s carbon pollution-free vitality. A majority of its output is nuclear vitality, but it surely 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 as we speak.
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 other than nuclear energy crops. Altogether, it’s the largest vitality procurement contract the GSA has signed in its historical past.
“This historic procurement locks in a cost-competitive, dependable provide of nuclear vitality,” GSA administrator Robin Carnahan stated in a press launch. “We’re demonstrating how the federal authorities can be a part of main company clear vitality patrons in spurring new nuclear vitality capability and making certain a dependable, reasonably priced provide of unpolluted vitality for everybody.”
The contract will enable Constellation to increase licenses for current nuclear energy crops in addition to “put money into new gear and know-how” that ought to end in 135 megawatts of further capability. The GSA agreed to buy 2.4 million megawatt-hours of electrical energy from that added capability over 10 years. Exterior 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 method to lock in additional reasonably priced costs as knowledge facilities drive up electrical energy demand and enhance competitors for restricted clear vitality sources:
Within the face of uncertainty over future electrical energy costs and rising electrical energy demand from knowledge facilities and AI amenities, as an example, this contract offers federal businesses with budgetary stability and protections from future worth will increase by retaining their electrical energy prices fastened for 10 years, whereas additionally persevering with to bolster the home nuclear trade.
Google, Meta, Amazon, and Microsoft have all inked splashy nuclear vitality 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 location of the worst nuclear vitality accident in US historical past.
The Biden administration has additionally made nuclear vitality a key a part of its plan to transition the US away from fossil fuels to vitality sources that don’t trigger local weather change. Final October, the Division of Power 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 vitality, the Trump marketing campaign agenda included efforts to “help nuclear vitality manufacturing.”
