Google has found a way to get more nuclear power without building a new reactor. On Tuesday, the company and Constellation Energy announced a 20-year power purchase agreement that will add 890 megawatts of capacity to the largest US power grid. Constellation will put up more than $4.3 billion to do it.
Investors liked it.
Constellation shares soared 12.3% after the announcement
, according to a Yahoo Finance market roundup.
What the deal covers
The money will go into upgrades at existing plants. According to the companies,
turbine, steam generator and digital control system work will take place at 11 Constellation nuclear units in Illinois, Pennsylvania and New Jersey
. The capacity feeds the PJM Interconnection grid. The first additional power is expected by 2028.
Engineers call this an “uprate”: newer, more efficient equipment lets a licensed, grid-connected reactor produce more electricity. TheStreet notes that the 890 MW addition is roughly equal to a large new reactor. The difference is speed, since an uprate skips the site search and the wait in the grid connection queue.
The companies also signed a separate 15-year supply agreement for another 2,700 megawatts from Constellation’s existing fleet in PJM. Together, Google says it has contracted 3,590 megawatts. Roughly three-quarters of that package pays for reactors that already run, as TheStreet pointed out.
The companies say the project should sustain about 4,400 existing jobs and create about 7,200 construction jobs during the build.
Why a grid operator matters to your bill
PJM serves 67 million people across 13 states and Washington, D.C. That includes many households that have seen electricity costs climb. One Yahoo Finance report says PJM capacity prices have risen more than 11-fold since 2024. That report also says PJM has proposed that data centers bring their own power or risk being cut off at peak times. The Google deal appears to respond to that proposal. TheStreet argues that Google signed before the region’s data center rules were final.
The logic is plain. AI data centers use enormous amounts of electricity, and the grid has struggled to supply it. If the company that wants the power pays for new supply, the cost is less likely to land on other customers. That outcome is not guaranteed by anything in the announcement, and the companies have not said how the deal will affect retail rates.
Google’s Amanda Peterson Corio, its global head of energy and power, said in a statement that the company wants to meet its growth responsibly by investing in clean, reliable power. Nuclear plants, unlike wind or solar, run around the clock.
A pattern, with caveats
Reuters reported that major technology companies are racing to lock in electricity for data centers, in some cases by helping revive the US nuclear industry. Bloomberg, via Advisor Perspectives, noted that new reactors can take a decade or more to build, and next-generation designs are years from wide use. Upgrading existing plants is the faster route.
There are risks. The $4.3 billion is real money leaving Constellation’s balance sheet, and one analysis notes that after the stock’s jump, expectations are now higher. Projects of this kind can also run late or over budget. Constellation had already signed about 920 megawatts of other long-term nuclear deals, and about 30% of its clean baseload output is now under long-term contracts, according to that analysis.
For ordinary readers, the effect will not show up soon. The first new power is two years away. But the deal shows who is now paying to expand the grid, and a few other companies in the same market will be watching how it works out.