Amazon Tries to Boost Nuclear Power in Maryland After Scrapping Data Center Deal

Dow Jones
3 hours ago

Amazon.com walked away last month from plans to build a data-center campus next to a nuclear plant in Maryland after facing community opposition. Instead, the tech giant will help expand power generation at the plant and explore the possibility of adding new reactors there.

Amazon has signed an agreement with Constellation Energy to help upgrade the Calvert Cliffs Clean Energy Center, a nuclear site on the western shore of Chesapeake Bay, by adding 190 megawatts of power that will feed back into the regional grid. That's enough to power about 147,000 new homes. In return, Constellation will supply the tech company with up to 690 megawatts of power long term from across its fleet.

Amazon and other big tech companies are racing to secure energy for newly built data centers that will power AI and can guzzle as much electricity as a midsize city. Nuclear energy is considered an attractive option because it provides reliable, carbon-free electricity around the clock.

The deal with Constellation is Amazon's first "uprate project," one that increases the power output of an existing nuclear plant.

"Bringing net new capacity into that market makes sense-bringing net new carbon-free capacity makes even more sense," said Brandon Oyer, a nuclear engineer who is head of Americas power and water at Amazon.

"We're still contracting for wind, we're still contracting for solar, we're still contracting for those combined with batteries. We're continuing to go out and say, 'Where else can we bring on new resources in a compressed timeline?'" he said.

Meanwhile, opposition to building data centers is growing across the country, particularly over fears that they could increase energy prices. Residents in the Maryland community voiced environmental, resource and health concerns about the project that was scrapped last month.

Calvert Cliffs is home to two reactors that can generate up to 1,790 megawatts of electricity, enough to power more than 1.3 million homes. But like much of America's aging nuclear fleet, the reactors came online in the 1970s.

The 20-year agreement with Amazon will help extend operations at the plant, where one reactor is up for re-licensing in 2034 and another in 2036, said David Dardis, senior executive vice president at Constellation.

"It really helps secure the long-term future of Calvert," Dardis said. The agreement will support more than $3 billion in investments, including plant improvements and the increase in generating capacity.

Amazon and Constellation are also exploring whether they could install next-generation nuclear technology, including new reactors, at the site. Much of the industry's recent focus has centered on SMRs, or small modular reactors that developers hope will be cheaper and faster to build.

Although dozens of projects are under way, only a handful of new commercial reactors have come online in the U.S. since 2000. America's last big nuclear-power project came in more than $16 billion over budget and seven years behind schedule.

Amazon is already betting big on nuclear. The company has a power purchase agreement with Talen Energy at its Susquehanna nuclear plant in Pennsylvania and is funding the development of small modular reactors in Washington at the Cascade Advanced Energy Center. Amazon also invested in, and is a customer of, X-energy, a reactor developer that went public earlier this year.

Other big tech companies have struck similar deals. Microsoft agreed to a 20-year power deal to support Constellation's restart of the undamaged reactor at Pennsylvania's Three Mile Island, the site of America's worst nuclear accident. And Google is partnering with NextEra Energy to reopen the Duane Arnold Energy Center, a nuclear plant in Iowa, by early 2029.

Nuclear energy is enjoying a resurgence in popularity after largely falling out of favor after the Three Mile Island incident in 1979. Polling suggests most Americans support more nuclear power plants coming online. President Trump has said he wants to quadruple nuclear power generation over the next 25 years.

Oyer said the nuclear revival has opened up far more possibilities for businesses including Amazon.

"I never would have thought this [was possible] a couple of decades ago," Oyer said.

 

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