The parent company of Facebook, Instagram and WhatsApp will probably be paying about $80 (€70) per megawatt hour for energy from the Clinton plant in Illinois, according to Paul Zimbardo, an analyst at Jefferies, who made the forecast based on company guidance.
That compares with the firm’s estimate of at least $110 for Microsoft’s deal for power from Pennsylvania’s Three Mile Island plant.
Constellation Energy operates both nuclear sites and hasn’t disclosed details for either agreement, with chief executive officer Joe Dominguez saying in an interview that the contracts reflect “the fair price of reliable clean energy”, without providing more details.
The pricing outlook for Meta and Microsoft is different because generating energy at Three Mile Island is requiring the restart of a reactor, Mr Zimbardo said. The cost to revive the plant is estimated at $1.6bn after it was shut in 2019 for economic reasons. Meanwhile, the Clinton site is already in operation.
“There’s a difference between a restart and a normal, operating plant,” Mr Zimbardo said.
Technology companies have shown that they’re willing to pay hefty premiums for nuclear energy, which is generally more expensive than fossil-fuel generation.
They’re betting that the carbon-free electricity that comes from atomic plants will help them meet their ambitious climate goals even as demand climbs to power the AI boom.
Wind and solar aren’t available all the time, but data centres are humming around the clock, and 24/7 nuclear energy meets both power and climate requirements.
“We have to recognise that some things are going to cost more than others,” said Michael Polsky, CEO of the independent power developer Invenergy. He spoke at a national security conference in Washington on Tuesday.
“Nuclear will cost more than gas. So if we want nuclear power in the future, we have to admit it will cost more,” Mr Polsky said.
Under the Meta deal, Constellation will invest in boosting Clinton’s output. The company is also considering plans to build another reactor at Clinton, which already has federal approval for a second unit.
Overall electricity prices in the region served by the Clinton plant have been climbing. Wholesale power climbed to $666.50 a megawatt-day for the grid operated by the Midcontinent Independent System Operator in an April capacity auction. That’s up sharply from $30 a year earlier.
The contract is Meta’s largest power deal to date, according to Urvi Parekh, the company’s global head of energy. The company is increasingly interested in nuclear to run its operations, and in December announced it was seeking proposals for as much as 4 gigawatts of new US reactors. So far it has received about 50 proposals from a range of companies, including Constellation.
That initiative is aimed as bringing power onto the grid in the early 2030s, while the Clinton deal is seen as a near-term effort. With the subsidies set to expire, Meta and Constellation said they wanted to ensure the plant remained competitive.
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