Amazon and Google have each signed 20-year nuclear electricity contracts within a week of one another, as the AI industry shifts from chasing efficiency to securing supply. Amazon will draw 690 megawatts from Constellation's Calvert Cliffs plant in Maryland, while Google's deal adds 890 megawatts of nuclear capacity in the US. Constellation is spending over $4.3bn to upgrade 11 reactors across Illinois, Pennsylvania and New Jersey. Notably, no new reactors are being built - the companies are paying to squeeze more output from existing plants, some older than the firms themselves.
Nuclear power had fallen out of favour after Three Mile Island, Chornobyl and Fukushima, but an undamaged unit at Three Mile Island is returning to service with Microsoft contracted to buy its output for 20 years. The US Department of Energy is backing restarts of three shuttered plants with up to $4.4bn in loans, targeting roughly 2.25 gigawatts. Michigan's Palisades, closed in 2022, is contracted to generate again by March 2027.
Efficiency gains have not curbed demand. The International Energy Agency expects global data centre electricity demand to more than double to around 945 terawatt-hours by 2030, even with continued efficiency improvements. New large reactors take a decade or more, and small modular reactors are not expected to deliver power until the early 2030s.
Most deals sit inside PJM, the grid operator serving about 67 million people across 13 states and Washington, DC. Capacity prices have hit the regulatory cap in three consecutive auctions, and the grid's independent market monitor attributes roughly $29.4bn in capacity costs across four recent auctions to data centre demand. The Natural Resources Defense Council estimates typical PJM households could pay an extra $70 per month by 2028 if trends continue. Virginia has created a separate rate class for data centres, Ohio introduced minimum billing requirements, and Illinois is debating legislation.
Google's agreement aims to answer the objection that new large consumers should bring extra generation rather than compete for constrained supply. But the arrangement is voluntary: in October 2026, federal regulators rejected most of PJM's proposal to require large new consumers to supply their own capacity.
Gulf countries expanding AI infrastructure face similar questions. Qatar's sovereign fund has committed to a $20bn joint venture with Brookfield, starting at roughly 300 megawatts and potentially reaching near 1.5 gigawatts - about 12 percent of the country's installed generating capacity. Abu Dhabi is pursuing up to five gigawatts, and Saudi Arabia targets almost two gigawatts through HUMAIN. The article's author argues the Gulf can settle who bears the costs before large-scale commitments limit its options.
Source: Al Jazeera