Two days after Google struck a “world-first” deal to buy electricity from advanced nuclear reactors, Amazon today announced three new deals of its own.
Each deal supports the development of small modular reactors (SMRs), which can be a tenth to a quarter the size of a conventional nuclear power plant. If these projects reach the finish line, SMRs would be a source of carbon-free energy for major tech companies trying to meet their climate goals by switching to nuclear energy.
Each deal supports the development of small modular reactors
Amazon signed an agreement with Energy Northwest, a consortium of public utilities in Washington state, to “facilitate the development” of four SMRs by the early 2030s. According to Energy Northwest, Amazon has agreed to fund “the first phase of feasibility” near an existing nuclear power plant in Richland, Washington. The e-commerce giant could then obtain electricity from the first four modules built, with a total output of 320 megawatts. The deal includes “the option to further expand the site” to 12 units with capacity of up to 960 MW, which Amazon said would be enough to power 770,000 homes in the US. Additional electricity from expanded site would be available to Amazon as well as other businesses and households in the area.
Amazon is also investing in startup X-Energy, which is developing an advanced nuclear reactor design expected to be used in the Energy Northwest project. Energy Northwest would ultimately build, own and operate the reactors. Since 2020, the company has been reviewing plans for a nuclear facility using X-energy's Xe-100 high-temperature gas-cooled reactor design.
X-energy today announced a $500 million Series C-1 funding round anchored by Amazon. Beyond the Washington project, the money will support the “completion of reactor design and licensing for X-energy” and the development of a fuel plant in Oak Ridge, Tennessee. X-energy says it is “collaborating” with Amazon to bring more than 5,000 MW of new SMR projects online in the U.S. by 2039, which it says would be the largest commercial deployment of SMRs to date. To achieve this, the two companies plan to “establish and standardize a delivery and financing model to develop projects in partnership with infrastructure and utility partners.”
In Virginia, utility Dominion Energy entered into a contract with Amazon to “explore the development of an SMR project” near its existing North Anna nuclear power plant. Virginia is a hub for energy-hungry hyperscale data centers, and Dominion expects power demand in the state to double over the next 15 years. The SMR project with Amazon could generate 300 MW of electricity if implemented.
Nuclear power has become an attractive energy source for tech companies like Amazon, Google and Microsoft that are struggling to meet their climate change commitments. Data centers use a lot of electricity – those used to train AI even more so – and that means more greenhouse gas emissions unless those data centers are powered by carbon-free energy. Amazon, Google and Microsoft all have larger carbon footprints today than when they made major climate commitments a few years ago.
Nuclear reactors are also an attractive option for data centers that run around the clock because, unlike solar and wind farms, they can generate electricity regardless of the weather or time of day. SMRs are also said to be quicker to build and easier to deploy than larger traditional nuclear power plants.
These SMR projects are subject to regulatory approval and may continue to face economic headwinds. The U.S. Nuclear Regulatory Commission first certified a design for a small modular reactor in January 2023, a design by a company called NuScale Power. But in November, NuScale had to abandon plans to build a much-anticipated demonstration power plant after costs soared.
Major technology companies have also shown interest in traditional nuclear power plants. In March, Amazon Web Services announced the purchase of a data center campus powered by a nuclear power plant in Pennsylvania. Microsoft struck a deal in September to help revive and purchase electricity from the decommissioned Three Mile Island power plant.
Nuclear energy still faces opposition from advocates concerned about the potential environmental and health risks associated with mining and enriching uranium for reactors and storing radioactive waste.
“It’s time for Big Tech to get back to solutions that work And “Reducing risk to our environment and health, including making data centers as energy efficient as possible and requiring them to power them with new renewable energy sources,” said Johanna Neumann, senior director at the Environment America Research & Policy Center, in a statement released after Google's SMR announcement this week.