Sign In or Create an Account.

By continuing, you agree to the Terms of Service and acknowledge our Privacy Policy


What Does Amazon Want With Nuclear?

The tech giant’s $650 million deal with Talen Energy has a lot to unpack.

A nuclear tower.
Heatmap Illustration/Getty Images

When Talen Energy, which owns a 90% interest in the Susquehanna nuclear power plant in Northeastern Pennsylvania, announced it was selling a data center site adjacent to its power plant to Amazon Web Services, it raised some eyebrows in the energy world. The surprise was not because a large tech company made a big deal with a carbon-free power provider, or even that a tech company made a deal to buy power generated by a nuclear power plant. It was because Amazon was making this deal.

Amazon is a massive buyer of renewable power — it claims to be the world’s largest and says it’s responsible for 28 gigawatts of clean energy capacity — signing contracts with new wind and solar projects all over the world.

But a divide has opened up among tech giants when it comes to energy, with Amazon on one side and Alphabet and Microsoft on the other. The difference hinges on how much it matters where and when the new carbon-free power a company buys in order to match its electricity use.

What’s odd about the Talen deal is that it fits awkwardly into either approach, especially Amazon’s. Amazon does not count nuclear towards its renewable power goals, and in any case, it’s not a “new” source of carbon-free power. Instead, it allows Amazon to siphon somewhere between 480 and 960 megawatts of capacity from the 2,500 megawatt plant.

“Amazon needs power, they’re getting it at cheap rates. They don’t even want to talk about it like a climate thing,” Mark Nelson, the founder of Radiant Energy Group, told me.

In the past decade or so, technology companies have gone on a clean-power buying spree, funding new wind and solar projects all over the world. But there has been a divergence in what is thought to be the best way to go about it.

In 2019, Amazon announced a goal to add enough renewable power to the grid to match its own emissions by 2030 (since moved up to 2025) and to reach net zero by 2040.

Google has been 100% renewable in terms of buying clean power in the same amounts that it consumes since 2017. So in 2020, it set a new goal: to “run on 24/7 carbon-free energy on every grid where we operate by 2030.” This would mean not just matching total renewable purchases with total emissions, as Amazon is seeking to do, but also trying to get every hour of data center operation “matched” with an hour of renewable generation on the same grid.

Microsoft has a similar goal, and as a result, both companies have shown much more interest in nuclear power of late than is typical in the technology world.

“A huge bottleneck for growth for Amazon, Google, Microsoft, Facebook is access to constant electricity,” Nelson told me. Nuclear is a carbon-free electricity resource that can run at a steady output 24 hours a day, whereas wind and solar are both inherently variable.

Microsoft signed a deal with Constellation to supply power to data centers in Virginia and hired an official from the Tennessee Valley Authority to be its director of nuclear and energy innovations, while Microsoft founder Bill Gates and Sam Altman, the head of Microsoft-backed OpenAI have both invested in nuclear startups, as has Google.

Amazon’s approach — which it shares with several other large companies, including Meta — is not to match 24 hours of its operations with clean power bought locally, but rather to develop and purchase new wind and solar at the same scale of the power it consumes, especially in areas with dirty grids, thus matching the emissions from its consumption with the emissions reductions of new renewables projects. While a 24/7 matching approach may be naturally complementary with nuclear power, Amazon’s strategy doesn’t require it.

“We believe a focus on emissions is the fastest, most cost-effective and scalable way to leverage corporate clean energy procurement to help decarbonize global power grids at the fastest pace,” an Amazon spokesperson told me. “This includes procuring renewable energy in locations and countries that still rely heavily on fossil fuels to power their grids, and where energy projects can have the biggest impact on carbon reduction.”

Contracting out new renewable energy projects can have more bang for your buck in dirty grids, according to proponents of the Amazon philosophy, known as carbon matching. The hypothesis is that a renewable project in a fossil fuel-heavy grid will displace more dirty power than one that’s located near a datacenter in an already relatively clean grid like California or Washington State.

Princeton researchers who examined the carbon matching (Amazon) and temporal matching (Google and Microsoft) strategies argued that the carbon matching approach does not necessarily lead to more renewables — or less fossil fuels — on the grid than would have occurred in the absence of the tech companies, and thus does not actually greatly lower emissions. The temporal approach, on the other hand, can meaningfully displace fossil fuel power that would otherwise have to be on the grid to meet demand.

Nuclear advocates are clear-eyed that this deal won’t cause a new generating unit to sprout up out of the Susquehanna Valley. But they still see it as the kind of deal that can help ensure nuclear plants’ continued survival. Amazon’s $650 million buys it a 10-year agreement to purchase power from the plant, as well as “additional revenue from AWS related to sales of carbon-free energy to the grid,” which an Amazon spokesperson explained as a reference to the deal “ensur[ing] that the nuclear plant has stable revenues to continue generating clean power to the grid for the foreseeable future.”

Nelson, a passionate advocate for nuclear power, lamented the mass shutdown of nuclear power plants in the 2010s thanks to cheap natural gas knocking them out of power markets that didn’t value reliability or carbon-free energy. But now, he says, things are different.

“Now nuclear is getting valued for its climate properties, reliability, and low cost. We’re seeing nuclear plants cash in,” Nelson told me. “Long term PPAs with cold hard cash help me sleep better at night.”

Matthew Zeitlin profile image

Matthew Zeitlin

Matthew is a correspondent at Heatmap. Previously he was an economics reporter at Grid, where he covered macroeconomics and energy, and a business reporter at BuzzFeed News, where he covered finance. He has written for The New York Times, the Guardian, Barron's, and New York Magazine.


AM Briefing: Energy at the RNC

On the GOP’s big week, wildfires, and hydrogen-powered ferries

The Subtle Energy Themes of the 2024 RNC
Heatmap Illustration/Getty Images

Current conditions: Russia declared a state of emergency as forest fires rage near the Black Sea • Tornado sirens sounded in downtown Chicago last night • It will be rainy and hot in Milwaukee today for the start of the Republican National Convention.


1. RNC to go ahead in Milwaukee despite Trump assassination attempt

The Republican National Convention will go ahead as planned in Milwaukee, Wisconsin, this week, even after Saturday’s assassination attempt of former President Donald Trump. During the four-day event, the party will formally designate Trump as its presidential candidate and learn who will be running alongside him. While not the sole focus, energy themes will be present throughout, E&E Newsreported last week, though of course plans may have changed in light of the weekend events. Speakers are expected to weave in references to high energy prices, call out Biden’s “anti-drilling” stance, and attack his climate policies. RNC chairman Michael Whatley, a former oil lobbyist, will likely kick things off Monday. Officials from major energy groups including the American Petroleum Institute, the National Mining Association, and the American Clean Power Association will be in attendance (and may also be at the DNC in August). A handful of conservative climate change groups will host a reception “to promote climate change policies aimed at Republicans.” Some of that will involve pushing clean energy policies, E&E News added. The RNC coordinator for the Secret Service said there would be no changes to the security plans for the event following the weekend violence. Guns aren’t allowed inside the convention center but they’ll be permitted in some areas outside the building.

Keep reading...Show less

Is Sodium-Ion the Next Big Battery?

U.S. manufacturers are racing to get into the game while they still can.

Sodium-ion batteries.
Heatmap Illustration/Getty Images, Peak Energy, Natron Energy

In the weird, wide world of energy storage, lithium-ion batteries may appear to be an unshakeably dominant technology. Costs have declined about 97% over the past three decades, grid-scale battery storage is forecast to grow faster than wind or solar in the U.S. in the coming decade, and the global lithium-ion supply chain is far outpacing demand, according to BloombergNEF.

That supply chain, however, is dominated by Chinese manufacturing. According to the International Energy Agency, China controls well over half the world’s lithium processing, nearly 85% of global battery cell production capacity, and the lion’s share of actual lithium-ion battery production. Any country creating products using lithium-ion batteries, including the U.S., is at this point dependent on Chinese imports.

Keep reading...Show less
Electric Vehicles

AM Briefing: Tesla’s Delay

On Musk’s latest move, Arctic shipping, and China’s natural disasters

Tesla Is Delaying the Robotaxi Reveal
Heatmap Illustration/Getty Images

Current conditions: Heavy rains triggered a deadly landslide in Nepal that swept away 60 people • More than a million residents are still without power in and around Houston • It will be about 80 degrees Fahrenheit in Berlin on Sunday for the Euro 2024 final, where England will take on Spain.


1. Biden administration announces $1.7 billion to convert auto plants into EV factories

The Biden administration announced yesterday that the Energy Department will pour $1.7 billion into helping U.S. automakers convert shuttered or struggling manufacturing facilities into EV factories. The money will go to factories in eight states (including swing states Michigan and Pennsylvania) and recipients include Stellantis, Volvo, GM, and Harley-Davidson. Most of the funding comes from the Inflation Reduction Act and it could create nearly 3,000 new jobs and save 15,000 union positions at risk of elimination, the Energy Department said. “Agencies across the federal government are rushing to award the rest of their climate cash before the end of Biden’s first term,” The Washington Post reported.

Keep reading...Show less