An Amazon Web Services data center in Stone Ridge, Virginia, US, on Sunday, July 28, 2024. Data center developers in Northern Virginia are asking utility Dominion Energy Inc. for as much power as several nuclear reactors can generate, in the latest sign of how artificial intelligence is helping drive up electricity demand.
- AWS announced it has signed an agreement with Dominion Energy, Virginia's utility company, to explore the development of a small modular nuclear reactor, near Dominion's existing North Anna nuclear power station.
- AWS, Amazon's subsidiary in cloud computing, has a massive and increasing need for clean energy as it expands its services into generative AI. The agreement is also a part of Amazon's path to net-zero carbon emissions.
- Amazon is the latest large tech company to buy into nuclear power to fuel the growing demands from data centers. Google and Microsoft have announced similar plans.
Amazon Web Services is investing more than $500 million in nuclear power, announcing three projects from Virginia to Washington state. AWS, Amazon's subsidiary in cloud computing, has a massive and increasing need for clean energy as it expands its services into generative AI. It's also a part of Amazon's path to net-zero carbon emissions.
AWS announced it has signed an agreement with Dominion Energy, Virginia's utility company, to explore the development of a small modular nuclear reactor, or SMR, near Dominion's existing North Anna nuclear power station. Nuclear reactors produce no carbon emissions.
An SMR is an advanced type of nuclear reactor with a smaller footprint that allows it to be built closer to the grid. They also have faster construction times than traditional reactors, allowing them to come online sooner.
Amazon is the latest large tech company to buy into nuclear power to fuel the growing demands from data centers. Earlier this week, Google announced it will purchase power from SMR developer Kairos Power. Constellation Energy is restarting Three Mile Island to power Microsoft data centers.
"We see the need for gigawatts of power in the coming years, and there's not going to be enough wind and solar projects to be able to meet the needs, and so nuclear is a great opportunity," said Matthew Garman, CEO of AWS. "Also, the technology is really advancing to a place with SMRs where there's going to be a new technology that's going to be safe and that's going to be easy to manufacture in a much smaller form."
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Virginia is home to nearly half of all the data centers in the U.S., with one area in northern Virginia dubbed Data Center Alley, the bulk of which is in Loudon County. An estimated 70% of the world's internet traffic travels through Data Center Alley each day.
Dominion serves roughly 3,500 megawatts from 452 data centers across its service territory in Virginia. About 70% is in Data Center Alley. A single data center typically demands about 30 megawatts or greater, according to Dominion Energy. Bob Blue, its president and CEO, said in a recent quarterly earnings call that the utility now receives individual requests for 60 megawatts to 90 megawatts or greater. Dominion projects that power demand will increase by 85% over the next 15 years. AWS expects the new SMRs to bring at least 300 megawatts of power to the Virginia region.
"Small modular nuclear reactors will play a critical role in positioning Virginia as a leading nuclear innovation hub," said Virginia Gov. Glenn Youngkin in a release. "Amazon Web Services' commitment to this technology and their partnership with Dominion is a significant step forward to meet the future power needs of a growing Virginia."
AWS plans to invest $35 billion by 2040 to establish multiple data center campuses across Virginia, according to an announcement from Youngkin last year.
"These SMRs will be powering directly into the grid, so they'll go to power everything, part of that is the data centers, but everything that is plugged into the grid will benefit," Garman added.
Amazon also announced a new agreement with utility company Energy Northwest, a consortium of state public utilities, to fund the development, licensing and construction of four SMRs in Washington state. The reactors will be built, owned and operated by Energy Northwest but will provide energy directly to the grid, which will also help power Amazon operations.
Under the agreement, Amazon will have the right to purchase electricity from the first four modules. Energy Northwest has the option to build up to eight additional modules. That power would also be available to Amazon and utilities in the Northwest to power homes and businesses.
The SMRs will be developed with technology from Maryland-based X-energy, a developer of SMRs and fuel. Along with Amazon's other announcements, Amazon's Climate Pledge Fund disclosed it is the lead anchor in a $500 million financing round for X-Energy. The Climate Pledge Fund is its corporate venture capital fund that invests in early-stage sustainability companies. Other investors include Citadel founder and CEO Ken Griffin, affiliates of Ares Management Corp., NGP and the University of Michigan.
"Amazon and X-energy are poised to define the future of advanced nuclear energy in the commercial marketplace," said X-energy CEO J. Clay Sell. "To fully realize the opportunities available through artificial intelligence, we must bring clean, safe, and reliable electrons onto the grid with proven technologies that can scale and grow with demand."
The Biden administration has funneled billions of dollars into clean energy production. As part of this AWS announcement, U.S. Energy Secretary Jennifer Granholm said $900 million of new funding is now available for those looking to deploy more SMRs.
"We want these data centers to be built in the United States for a variety of reasons, including national security reasons. We need additional power to be able to do that, and we want that power to be clean power," said Granholm.
Last spring, AWS invested in a nuclear energy project with Talen Energy, signing an agreement to purchase nuclear power from the company's existing Susquehanna Steam Electric Station, a nuclear power station in Salem Township, Pennsylvania. AWS also purchased the adjacent, nuclear-powered data center campus from Talen for $650 million.
