A New Era for Nuclear Energy in the US
The General Services Administration (GSA), which is responsible for managing government buildings, has just announced a significant nuclear energy contract. This announcement comes on the heels of several big tech companies making a flurry of nuclear energy deals last year.
A 10-Year, $840 Million Contract
The 10-year, $840 million contract is for 10 million megawatt-hours of electricity, which the GSA says is equivalent to what’s needed for more than 1 million homes annually. The agency has awarded the contract to Constellation, which operates the nation’s largest nuclear fleet and recently announced an agreement with Microsoft to restart a nuclear reactor at Three Mile Island.
Nuclear Energy Takes Center Stage
According to Constellation spokesperson Paul Adams, nuclear energy makes up a significant portion of the GSA deal, approximately 4 million megawatt-hours. Silicon Valley is increasingly turning to nuclear energy to satisfy electricity demand from AI data centers. The federal government is the nation’s single largest energy consumer, making this contract a big boon to the nuclear industry.
A New Era for Nuclear Energy in the US
"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. This agreement is another powerful example of how things have changed." The United States government joins Microsoft and other entities to support continued investment in reliable nuclear energy that will allow Constellation to relicense and extend the lives of these critical assets.
Constellation’s Commitment to Nuclear Energy
Constellation says it 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. It also generates electricity from gas-fired power plants, although the company has set a goal of reaching 100 percent carbon-free electricity by 2040 compared to close to 90 percent today.
A Breakdown of the Contract
Constellation and the GSA declined to answer questions about how much of the electricity included in the contract will come from each source aside from nuclear power plants. However, it’s clear that this contract is a major milestone for the nuclear industry.
The Benefits of the Contract
"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."
The Impact on Existing Nuclear Power Plants
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 that added capacity over 10 years.
A Broader Impact
Outside of GSA buildings, the deal also extends 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. The GSA is framing the 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.
A Shift Towards Nuclear Energy
In the face of uncertainty over future electricity prices and increasing electricity demand from data centers and AI facilities, this contract provides federal agencies with budgetary stability and protections from future price increases by keeping their electricity costs fixed for 10 years. This will also continue to bolster the domestic nuclear industry.
The Biden Administration’s Commitment to Nuclear Energy
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 Key Part of the Transition Away from Fossil Fuels
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.
A Shift in the Nuclear Industry
And while President-elect Donald Trump plans to undo progress made toward clean energy, the Trump campaign agenda included efforts to support nuclear energy production.
The GSA’s Commitment to Sustainable Energy
The GSA has been at the forefront of sustainable energy initiatives, and this contract is a testament to its commitment to providing affordable and reliable clean energy. By investing in nuclear energy, the GSA is supporting the development of new capacity and extending the lives of existing assets.
A New Era for Nuclear Energy in the US
This contract marks a significant milestone for the nuclear industry, and it’s clear that things are changing. The federal government is joining major corporate clean energy buyers in spurring new nuclear energy capacity and ensuring a reliable, affordable supply of clean energy for everyone.
The Benefits of Nuclear Energy
Nuclear energy has several benefits, including:
- Reliability: Nuclear power plants can operate continuously, providing a stable source of electricity.
- Scalability: Nuclear power plants can be scaled up or down depending on demand.
- Low Emissions: Nuclear energy generates no greenhouse gas emissions during operation.
A Future for Nuclear Energy
As the world continues to transition away from fossil fuels, nuclear energy will play an increasingly important role in providing reliable and affordable clean energy. With the right investment and support, the nuclear industry can continue to grow and thrive, providing a sustainable source of energy for generations to come.
Conclusion
The GSA’s contract with Constellation is a significant milestone for the nuclear industry, and it marks a new era for nuclear energy in the US. By investing in nuclear energy, the federal government is supporting the development of new capacity and extending the lives of existing assets. This will provide a reliable, affordable supply of clean energy for everyone.
