US Government Announces Historic Nuclear Energy Deal
The General Services Administration (GSA), which is responsible for managing government buildings, has announced a significant nuclear energy contract. This development comes on the heels of several major tech companies making substantial investments in nuclear energy last year.
A 10-Year, $840 Million Contract for Nuclear Energy
The GSA has awarded a 10-year, $840 million contract to Constellation, which operates the nation’s largest nuclear fleet. The contract includes the purchase of 10 million megawatt-hours of electricity, equivalent to what is needed for over 1 million homes annually. According to Constellation spokesperson Paul Adams, nuclear energy makes up approximately 4 million megawatt-hours of this total.
The Growing Importance of Nuclear Energy in Silicon Valley
Silicon Valley is increasingly turning to nuclear energy to meet the growing electricity demand from AI data centers. The federal government, being the nation’s single largest energy consumer, has made significant investments in renewable energy sources. This contract is a major boon for the nuclear industry and highlights the importance of reliable and affordable clean energy.
A New Era for Nuclear Energy
"This agreement is another powerful example of how things have changed," said Joe Dominguez, Constellation president and CEO, in a press release. "Frustratingly…nuclear energy was excluded from many corporate and government sustainable energy procurements. Not anymore."
The GSA’s administrator, Robin Carnahan, stated, "This historic procurement locks in a cost-competitive, reliable supply of nuclear energy. 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."
Constellation’s Commitment to Clean Energy
Constellation generates 10 percent of the nation’s carbon pollution-free energy. A majority of its output comes from nuclear energy, but it also produces hydro, wind, and solar power. The company has set a goal of reaching 100 percent carbon-free electricity by 2040.
Contract Details
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 this added capacity over the next 10 years.
The Contract’s Impact on Federal Agencies
This contract extends to not only the GSA but also 13 other federal agencies, including:
- Departments of Veterans Affairs and Transportation
- Federal Bureau of Prisons
- National Park Service
- Social Security Administration
- US Mint
Locking in Affordable Prices
The GSA is framing this contract as a way to lock in more affordable prices for federal agencies. With increasing electricity demand from data centers and AI facilities, this contract provides budgetary stability and protections from future price increases by keeping electricity costs fixed for 10 years.
Nuclear Energy: A Key Component of the Biden Administration’s Plan
The Biden administration has made nuclear energy a key part of its plan to transition the US away from fossil fuels. 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 Priorities
While some may question the need for nuclear energy, there is no denying that it has become an essential component of the country’s clean energy landscape. With companies like Google, Meta, Amazon, and Microsoft making significant investments in nuclear energy, it’s clear that this industry is here to stay.
Conclusion
The GSA’s historic nuclear energy contract is a significant development for the industry. By locking in affordable prices and demonstrating the reliability of nuclear energy, federal agencies can continue to reduce their carbon footprint while meeting growing electricity demands. As the nation continues to transition towards clean energy sources, nuclear energy will play an increasingly important role.
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