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Released September 08, 2025 | SUGAR LAND
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Researched by Industrial Info Resources (Sugar Land, Texas)--A recent conference at Rice University's Baker Institute for Public Policy, "Powering the Energy Future," highlighted nuclear power as a source of generation poised to supply the U.S. and Texas grids, now and in the future, especially as the rise of artificial intelligence (AI) leads to the need for more and more data center capacity, and therefore, more power generation and reliability. Sarfraz Taj, an executive with Constellation Energy (Baltimore, Maryland), which operates the U.S.' largest nuclear fleet, discussed his company's efforts and the overall landscape for nuclear power.
In late 2024, the U.S. Department of Energy (DOE) published its "2024 Report on U.S. Data Center Energy Use," which projected data center load growth will double or triple by 2028. The report found data centers consumed about 4.4% of total U.S. electricity in 2023 and are expected to consume approximately 6.7% to 12% of total U.S. electricity by 2028.
"Future energy demand scenarios indicate further growth based on a range of possible equipment shipments and operational practices of accelerated computing to support artificial intelligence services."
Taj, director of M&A corporate development and strategic projects for Constellation, kicked off a session titled "The Future of Nuclear Power" by saying some projections indicate more than 100 gigawatts (GW) worth of new power demand could come online on the U.S. grid in less than 10 years, and more than 50% of that could realize in the Electric Reliability Council of Texas (ERCOT) service area.
"When we look, especially from a nuclear operations perspective, at the type of load that's coming online, the data centers in AI are some of the biggest customers," he said. "When I look at the reliability requirements and concentrated loads ... the power density of nuclear is so much greater than any other form of power production."
He mentioned Constellation's two 20-year power purchase agreements (PPA) aimed specifically at powering the U.S. data center buildout: one with Microsoft Corporation (Redmond, Washington) to supply power from the former Three Mile Island nuclear power station in Pennsylvania, which is being restarted as the Crane Clean Energy Center, and another, with Meta Platforms Incorporated (Menlo Park, California) for the full output from the single, operational reactor (1.21 GW) at the Clinton Clean Energy Center in Illinois.
The Crane Clean Energy Center could be online in 2027, while offtake from Clinton will start in June 2027. The Clinton agreement will keep the plant operational into 2047 by supporting the "relicensing and continued operations," according to a press release. It also includes uprating the plant's single reactor by 30 megawatts.
For more information on the two efforts, see June 4, 2025, article - Meta to Buy Nuclear Power from Illinois Constellation Plant.
Subscribers to Industrial Info's Global Market Intelligence (GMI) Power Project and Plant databases can read detailed plant profiles for the Crane and Clinton nuclear stations, and click here for projects related to the proposed Crane Clean Energy Center restart and Clinton uprate.
Texas
In July, the Energy Information Administration (EIA), the data arm of the DOE, forecasted electricity demand in ERCOT could increase by 7% in 2025 and 14% in 2026 when some large data centers and cryptocurrency mining facilities come online. In the long term, ERCOT has estimated that data center energy demand across its coverage area could rise to 78 GW by 2031.
Constellation's Taj pointed to the need for additional power capacity in the wake of Winter Storm Yuri in February 2021, which caused millions of power outages across the state--some of which occurred for as long as four or five days.
The 20 GW of controlled load shed during the storm was the largest controlled load-shedding event in U.S. history, he said, in an effort to prevent a more catastrophic grid failure. Solar panels and wind turbines were frozen and there were issues getting natural gas to power plants.
According to a white paper from ERCOT, load-shedding requires rotating outages when generation demand exceeds supply, but only after initial measures (e.g. deploying emergency supply and requesting imports of power) are exhausted.
Taj said two nuclear plants with a combined four units totaling 5 gigawatts provided resiliency during Winter Storm Yuri: Vistra Corporation's (Irving, Texas) Comanche Peak Nuclear Power Plant and the South Texas Project (STP) generating station, the latter of which Constellation co-owns with public power utilities CPS Energy (San Antonio, Texas) and Austin Energy (Austin, Texas.)
Three units operated flawlessly, he said, while a fourth was down for only two days after a feed water sensing line froze.
There are some headwinds around building out nuclear generation, however, including the high fixed costs. For example, construction of two units at the Alvin W. Vogtle Nuclear Power in Georgia faced billions of dollars of cost overruns and was years late in getting completed. Utilities are seeking cost overrun protections for building out nuclear and other power plants.
In addition, proper regulatory frameworks will help developers and utilities manage investment risks.
Taj said that generally speaking, hyperscalers still operate from a renewables paradigm where they're used to signing a PPA with a developer or utility, after which the developer can get project financing. Meanwhile, nuclear plants can have a 10-year life cycle from permitting to construction to commissioning.
A hyperscaler is a firm that offers large-scale cloud computing services with the ability to rapidly scale up or down, such as Amazon's (Seattle, Washington) Web Services business unit.
The Texas government has been working to boost nuclear development. In June, Governor Greg Abbott (R) signed three bills into law aimed at meeting that goal, including House Bill 14 (H.B. 14). According to analysis, among other provisions, H.B. 14 establishes the Texas Advanced Nuclear Development Fund--which will support three new grant programs designed to reimburse expenses for qualifying projects using advanced nuclear technologies, including small modular reactors (SMRs) and microreactors; $350 million in grant funding has been approved.
SMRs
Small modular reactors are essentially small-scale, modular nuclear power facilities that could see a strong rollout due to their versatility and smaller footprint compared with traditional nuclear reactors.
Data center companies and hyperscalers, he said, may be willing to take a bet on SMRs compared with gigawatt-scale reactors, although on a megawatt-per-square-foot basis, SMRs are "a lot less efficient" than GW-scale reactors, "not just from an economies of scale perspective, but because the actual building is not that much smaller. So that is going to limit small modular reactors."
He indicated SMRs are more likely to be located behind-the-meter, where reactors feed power on-site. "I think there is a real opportunity there for the hyperscale entities."
IIR News earlier this year compared the SMR rush to the conventional nuclear revival of early this century--one that basically failed. For more information on this and the overall buildout of nuclear and SMR generation across the U.S., see April 21, 2025, article - Will Second Nuclear Renaissance in the U.S. End Like the First?, July 28, 2025, article - Closed Palisades Nuclear Plant Moves One Step Closer to Reopening, and August 26, 2025, article - Google to Partner with TVA, Kairos Power for SMR in Oak Ridge, TN.
President Donald Trump has set a lofty goal of deploying 300 GW of nuclear power in the U.S. by 2050 and having 10 large reactors under construction by 2030.
Industrial Info Resources (IIR) is the leading provider of industrial market intelligence. Since 1983, IIR has provided comprehensive research, news and analysis on the industrial process, manufacturing and energy related industries. IIR's Global Market Intelligence (GMI) platform helps companies identify and pursue trends across multiple markets with access to real, qualified and validated plant and project opportunities. Across the world, IIR is tracking more than 200,000 current and future projects worth $17.8 trillion (USD).
In late 2024, the U.S. Department of Energy (DOE) published its "2024 Report on U.S. Data Center Energy Use," which projected data center load growth will double or triple by 2028. The report found data centers consumed about 4.4% of total U.S. electricity in 2023 and are expected to consume approximately 6.7% to 12% of total U.S. electricity by 2028.
"Future energy demand scenarios indicate further growth based on a range of possible equipment shipments and operational practices of accelerated computing to support artificial intelligence services."
Taj, director of M&A corporate development and strategic projects for Constellation, kicked off a session titled "The Future of Nuclear Power" by saying some projections indicate more than 100 gigawatts (GW) worth of new power demand could come online on the U.S. grid in less than 10 years, and more than 50% of that could realize in the Electric Reliability Council of Texas (ERCOT) service area.
"When we look, especially from a nuclear operations perspective, at the type of load that's coming online, the data centers in AI are some of the biggest customers," he said. "When I look at the reliability requirements and concentrated loads ... the power density of nuclear is so much greater than any other form of power production."
He mentioned Constellation's two 20-year power purchase agreements (PPA) aimed specifically at powering the U.S. data center buildout: one with Microsoft Corporation (Redmond, Washington) to supply power from the former Three Mile Island nuclear power station in Pennsylvania, which is being restarted as the Crane Clean Energy Center, and another, with Meta Platforms Incorporated (Menlo Park, California) for the full output from the single, operational reactor (1.21 GW) at the Clinton Clean Energy Center in Illinois.
The Crane Clean Energy Center could be online in 2027, while offtake from Clinton will start in June 2027. The Clinton agreement will keep the plant operational into 2047 by supporting the "relicensing and continued operations," according to a press release. It also includes uprating the plant's single reactor by 30 megawatts.
For more information on the two efforts, see June 4, 2025, article - Meta to Buy Nuclear Power from Illinois Constellation Plant.
Subscribers to Industrial Info's Global Market Intelligence (GMI) Power Project and Plant databases can read detailed plant profiles for the Crane and Clinton nuclear stations, and click here for projects related to the proposed Crane Clean Energy Center restart and Clinton uprate.
Texas
In July, the Energy Information Administration (EIA), the data arm of the DOE, forecasted electricity demand in ERCOT could increase by 7% in 2025 and 14% in 2026 when some large data centers and cryptocurrency mining facilities come online. In the long term, ERCOT has estimated that data center energy demand across its coverage area could rise to 78 GW by 2031.
Constellation's Taj pointed to the need for additional power capacity in the wake of Winter Storm Yuri in February 2021, which caused millions of power outages across the state--some of which occurred for as long as four or five days.
The 20 GW of controlled load shed during the storm was the largest controlled load-shedding event in U.S. history, he said, in an effort to prevent a more catastrophic grid failure. Solar panels and wind turbines were frozen and there were issues getting natural gas to power plants.
According to a white paper from ERCOT, load-shedding requires rotating outages when generation demand exceeds supply, but only after initial measures (e.g. deploying emergency supply and requesting imports of power) are exhausted.
Taj said two nuclear plants with a combined four units totaling 5 gigawatts provided resiliency during Winter Storm Yuri: Vistra Corporation's (Irving, Texas) Comanche Peak Nuclear Power Plant and the South Texas Project (STP) generating station, the latter of which Constellation co-owns with public power utilities CPS Energy (San Antonio, Texas) and Austin Energy (Austin, Texas.)
Three units operated flawlessly, he said, while a fourth was down for only two days after a feed water sensing line froze.
There are some headwinds around building out nuclear generation, however, including the high fixed costs. For example, construction of two units at the Alvin W. Vogtle Nuclear Power in Georgia faced billions of dollars of cost overruns and was years late in getting completed. Utilities are seeking cost overrun protections for building out nuclear and other power plants.
In addition, proper regulatory frameworks will help developers and utilities manage investment risks.
Taj said that generally speaking, hyperscalers still operate from a renewables paradigm where they're used to signing a PPA with a developer or utility, after which the developer can get project financing. Meanwhile, nuclear plants can have a 10-year life cycle from permitting to construction to commissioning.
A hyperscaler is a firm that offers large-scale cloud computing services with the ability to rapidly scale up or down, such as Amazon's (Seattle, Washington) Web Services business unit.
The Texas government has been working to boost nuclear development. In June, Governor Greg Abbott (R) signed three bills into law aimed at meeting that goal, including House Bill 14 (H.B. 14). According to analysis, among other provisions, H.B. 14 establishes the Texas Advanced Nuclear Development Fund--which will support three new grant programs designed to reimburse expenses for qualifying projects using advanced nuclear technologies, including small modular reactors (SMRs) and microreactors; $350 million in grant funding has been approved.
SMRs
Small modular reactors are essentially small-scale, modular nuclear power facilities that could see a strong rollout due to their versatility and smaller footprint compared with traditional nuclear reactors.
Data center companies and hyperscalers, he said, may be willing to take a bet on SMRs compared with gigawatt-scale reactors, although on a megawatt-per-square-foot basis, SMRs are "a lot less efficient" than GW-scale reactors, "not just from an economies of scale perspective, but because the actual building is not that much smaller. So that is going to limit small modular reactors."
He indicated SMRs are more likely to be located behind-the-meter, where reactors feed power on-site. "I think there is a real opportunity there for the hyperscale entities."
IIR News earlier this year compared the SMR rush to the conventional nuclear revival of early this century--one that basically failed. For more information on this and the overall buildout of nuclear and SMR generation across the U.S., see April 21, 2025, article - Will Second Nuclear Renaissance in the U.S. End Like the First?, July 28, 2025, article - Closed Palisades Nuclear Plant Moves One Step Closer to Reopening, and August 26, 2025, article - Google to Partner with TVA, Kairos Power for SMR in Oak Ridge, TN.
President Donald Trump has set a lofty goal of deploying 300 GW of nuclear power in the U.S. by 2050 and having 10 large reactors under construction by 2030.
Industrial Info Resources (IIR) is the leading provider of industrial market intelligence. Since 1983, IIR has provided comprehensive research, news and analysis on the industrial process, manufacturing and energy related industries. IIR's Global Market Intelligence (GMI) platform helps companies identify and pursue trends across multiple markets with access to real, qualified and validated plant and project opportunities. Across the world, IIR is tracking more than 200,000 current and future projects worth $17.8 trillion (USD).
