The General Services Administration (GSA), which is responsible for managing government buildings, has recently announced a significant nuclear energy contract. This announcement comes on the heels of several big tech companies making major deals in the nuclear energy sector last year.
A Major Contract with Significant Implications
The 10-year, $840 million contract is for 10 million megawatt-hours of electricity, which is equivalent to what’s needed for more than 1 million homes annually. The GSA has awarded the contract to Constellation, which operates the nation’s largest nuclear fleet and recently announced an agreement with Microsoft to restart a nuclear reactor at Three Mile Island.
Nuclear Energy Takes Center Stage
According to Constellation spokesperson Paul Adams, nuclear energy makes up a significant portion of the GSA deal, approximately 4 million megawatt-hours. This is not surprising given the increasing demand for clean energy sources in Silicon Valley, where tech companies are turning to nuclear energy to meet their electricity needs.
A Big Deal for the Nuclear Industry
The federal government is the nation’s single largest energy consumer, making this contract a significant boon to the nuclear industry. As Joe Dominguez, Constellation president and CEO, noted in a press release, "This agreement is another powerful example of how things have changed." He continued, "Frustratingly… nuclear energy was excluded from many corporate and government sustainable energy procurements. Not anymore."
Constellation’s Commitment to Clean Energy
Constellation generates 10 percent of the nation’s carbon pollution-free energy. A majority of its output is nuclear energy, but it also produces hydro, wind, and solar power. Additionally, the company generates electricity from gas-fired power plants, although it has set a goal of reaching 100 percent carbon-free electricity by 2040 compared to close to 90 percent today.
A Partnership for Reliable Clean Energy
Constellation and the GSA declined to answer questions about how much of the electricity included in the contract will come from each source aside from nuclear power plants. However, it’s worth noting that 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 Contract Benefits Federal Agencies
The GSA agreed to purchase 2.4 million megawatt-hours of electricity from the added capacity over 10 years. This contract will not only benefit the GSA but also extend to 13 other agencies, including the departments of Veterans Affairs and Transportation as well as the Federal Bureau of Prisons, the National Park Service, the Social Security Administration, and the US Mint.
Framing the Contract as a Solution
The GSA is framing the contract as a way to lock in more affordable prices as data centers drive up electricity demand and increase competition for limited clean energy sources. As Robin Carnahan, GSA administrator, noted in a press release, "This historic procurement locks in a cost-competitive, reliable supply of nuclear energy." She continued, "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."
A Growing Trend: Tech Companies Turning to Nuclear Energy
Google, Meta, Amazon, and Microsoft have all inked splashy nuclear energy deals over the past year. In September of last year, Microsoft and Constellation announced a plan to restart a shuttered reactor at Three Mile Island in Pennsylvania, the site of the worst nuclear energy accident in US history.
The Biden Administration’s Support for Nuclear Energy
The Biden administration has made nuclear energy a key part of its plan to transition the US away from fossil fuels to energy sources that don’t cause climate change. 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
The Trump campaign agenda included efforts to "support nuclear energy production," which suggests that even the previous administration recognized the importance of nuclear energy in meeting our clean energy needs.
Conclusion
The GSA’s recent contract with Constellation is a significant development for the nuclear industry. As the federal government continues to prioritize clean energy sources, it’s likely that we’ll see more deals like this one in the future. The implications of this contract are far-reaching and have the potential to benefit not only the GSA but also other federal agencies and the environment as a whole.
References
- "GSA Awards 10-Year Contract for Nuclear Energy" (press release)
- "Constellation to Restart Shuttered Reactor at Three Mile Island" (press release)
- "Biden Administration Announces $1.52 Billion Loan to Help Restart Retired Nuclear Generating Station"
- "Trump Campaign Agenda Includes Efforts to Support Nuclear Energy Production"
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