The GSA Awards Record-Breaking Nuclear Energy Contract
A New Era for Nuclear Energy in the US
The General Services Administration (GSA), which oversees government buildings and facilities, has just announced a groundbreaking nuclear energy contract. This monumental deal comes on the heels of several major tech companies making significant strides in nuclear energy agreements last year.
Contract Details
The 10-year, $840 million contract is for 10 million megawatt-hours of electricity, equivalent to what’s needed for more than 1 million homes annually. The GSA awarded this substantial contract to Constellation, the operator of the nation’s largest nuclear fleet, which has recently partnered with Microsoft to restart a nuclear reactor at Three Mile Island.
Nuclear Energy Takes Center Stage
According to Constellation spokesperson Paul Adams, nuclear energy will comprise approximately 4 million megawatt-hours of the contracted electricity. This substantial commitment to nuclear power reflects the industry’s growing importance in meeting the increasing demand for clean energy sources.
Silicon Valley Turns to Nuclear Energy
In recent times, Silicon Valley companies have been increasingly turning to nuclear energy as a means to satisfy their electricity demands from AI data centers. The federal government, being the nation’s largest energy consumer, has recognized the potential benefits of this partnership. This contract is a significant boon to the nuclear industry, which has faced exclusion from many corporate and government sustainable energy procurements in the past.
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. This agreement is another powerful example of how things have changed."
Dominguez emphasized the importance of continued investment in reliable nuclear energy, which will enable Constellation to relicense and extend the lives of these critical assets.
Constellation’s Commitment to Clean Energy
Constellation generates 10 percent of the nation’s carbon pollution-free energy. A majority of its output is derived from nuclear energy, but it also produces hydro, wind, and solar power. The company aims to reach 100 percent carbon-free electricity by 2040, having already achieved close to 90 percent today.
Electricity Mix
While Constellation and the GSA declined to provide specific details on how much of the contracted electricity will come from each source aside from nuclear power plants, it’s clear that this contract represents a significant commitment to clean energy sources.
A Historic Procurement
This historic procurement is the largest energy procurement contract signed by the GSA in its history. "This historic procurement locks in a cost-competitive, reliable supply of nuclear energy," said GSA administrator Robin Carnahan in a press release. "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."
Capacity Expansion
The contract will enable 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 has agreed to purchase 2.4 million megawatt-hours of electricity from this added capacity over the next 10 years.
Agencies Involved
This contract extends beyond the GSA’s buildings, also encompassing 13 other agencies, including:
- Department of Veterans Affairs
- Department of Transportation
- Federal Bureau of Prisons
- National Park Service
- Social Security Administration
- US Mint
Framing the Contract
The GSA is framing this contract as a means to lock in more affordable prices due to increasing electricity demand from data centers and AI facilities. This deal provides federal agencies with budgetary stability and protections from future price increases by keeping their electricity costs fixed for 10 years, while also bolstering the domestic nuclear industry.
The Rise of Nuclear Energy
In recent times, major tech companies have made significant strides in nuclear energy agreements. Google, Meta, Amazon, and Microsoft have all inked splashy deals over the past year. Last September, Microsoft and Constellation announced a plan to restart a shuttered reactor at Three Mile Island, the site of the worst nuclear accident in US history.
The Biden Administration’s Commitment
The Biden administration has made nuclear energy a key part of its plan to transition the US away from fossil fuels to clean energy sources. Last October, the Department of Energy announced a $1.52 billion loan to help restart a retired nuclear generating station in Covert Township, Michigan. The Trump campaign also included efforts to support nuclear energy production.
Conclusion
This record-breaking contract marks a new era for nuclear energy in the US. As the federal government continues to prioritize clean energy sources, it’s clear that nuclear power will play an increasingly vital role in meeting growing demand. With this substantial commitment to nuclear energy, the GSA and Constellation are paving the way for a cleaner, more reliable future.
