Tech giants are increasingly turning to nuclear power to meet the growing energy demands of the data center boom.
For example, recent projects include Amazon’s funding of four small modular reactors in Washington state, Google’s agreement with Kairos Power to develop SMRs by 2030 and Microsoft’s power purchase agreement to restart Three Mile Island, a nuclear power plant near Harrisburg, Pennsylvania, that was shut down in 2019.
That connection between data centers and nuclear power plants should continue to strengthen, said Gordon Dolven, director of data center research at CBRE, a Dallas-based commercial real estate services firm.
“This role is expected to grow, especially with advancements like small modular reactors,” said Dolven. “[These] offer scalable and flexible solutions to support future energy needs.”
Integration of nuclear energy into tech companies’ operations offers new opportunities for contractors with specialized experience, said Fluor CEO David Constable during the firm’s third quarter earnings call.
Constable recently identified small modular reactors as a key growth area, saying “there’s a strong appetite for nuclear energy to meet incredible demand for power globally.” He added “interest has never been greater.”
SMRs offer significant advantages for contractors during the construction phase. Their modular design simplifies construction, reduces timelines and requires less land compared to traditional reactors, according to an Amazon news release. This makes SMRs particularly well-suited for powering data center operations, which demand reliable, around-the-clock energy to support artificial intelligence, said Dolven.
“There is growing interest in placing data centers near nuclear facilities. This is driven by the need for a reliable, 24/7 power source to support the growing demand for data centers, especially with the rise of AI workloads,” said Dolven. “Nuclear power offers consistent energy with zero carbon emissions, aligning with both operational and sustainability goals.”
Although expensive to build, nuclear power plants also offer relatively low operating costs for data center operators, according to the U.S. Energy Information Administration. That makes them an attractive option for tech companies aiming to power energy-intensive data centers while meeting emission reduction targets.
Upcoming projects
Amazon agreed in October to fund four SMR construction projects in Washington state in partnership with Energy Northwest. The plant will generate 320 megawatts in its first phase.
“It’s an important area of investment for Amazon,” said Matt Garman, CEO of Amazon Web Services, in a news release. “Our agreements will encourage the construction of new nuclear technologies that will generate energy for decades to come.”
Similarly, Kairos Power, a nuclear technology, engineering and manufacturing company, will develop, construct and operate a series of advanced reactor plants as part of its agreement with Google. The first SMR is set to be deployed by 2030, with plants strategically located near Google’s data centers, according to Kairos.
In Pennsylvania, Microsoft also entered into a 20-year agreement with Constellation Energy to purchase power generated by the Crane Clean Energy Center, formerly known as Three Mile Island Unit 1. The deal will supply Microsoft’s data centers in the region, and includes significant investments to restore the plant, such as the turbine, generator, main power transformer and cooling and control systems.
These projects, however, are still awaiting final regulatory approval, and contractors for the construction phases have not yet been announced. Nevertheless, the recent deals continue to showcase tech giants’ focus on nuclear energy to meet their power needs, said Dolven.
“Nuclear energy is playing a significant role in meeting the energy demands of data centers and AI technologies,” said Dolven. “Its ability to provide consistent, carbon-free power makes it an ideal solution as AI workloads drive unprecedented increases in energy consumption.”
