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As demand for electricity to power AI data centers surges, the tech industry is moving to secure a steady supply through nuclear-power plants, the Wall Street Journal has reported.
Talks are ongoing with the owners of about a third of U.S. nuclear-power plants, according to the report. Amazon (NASDAQ:AMZN) Web Services is nearing a deal with Constellation Energy (NASDAQ:CEG), which owns the largest fleet of U.S. nuclear plants, for direct power supply. AWS in March bought a nuclear-powered data center campus in Pennsylvania.
Vistra (NYSE:VST) and Public Service Enterprise (NYSE:PEG) have also been in talks for ‘behind-the-meter’ deals, where a large customer gets electricity directly from a plant.
The renewed interest in nuclear power bodes well for the industry, which has struggled to compete with other renewable sources and cheap natural gas.
But data center supply deals could result in diversion of existing electricity resources, in turn raising prices for other customers. Targets for reducing emissions may also be impacted, as customers turn to natural gas to replace diverted nuclear power.
Patrick Cicero, Pennsylvania’s consumer advocate, raised cost and reliability concerns over Amazon’s (AMZN) data center purchase in the state, with “massive consumers of energy kind of [getting] first dibs.”
Think tank The Conference Board said the rise of AI will fuel soaring electricity demand from data centers, but warned that this could overburden the power grid.