Amazon Web Services (AWS), a subsidiary of Amazon (NASDAQ:AMZN), is betting big on nuclear power as it partners with Dominion Energy (NYSE:D) and Energy Northwest to meet its data centers' energy needs.
The agreements with Dominion and Energy Northwest, valued over US$500 million, are aimed at developing advanced small modular reactors (SMRs), a flexible and scalable form of nuclear technology, across various regions.
The move addresses increasing power demand driven by artificial intelligence and cloud computing, as well as the company's commitment to achieving net-zero carbon emissions by 2040.
In Virginia, AWS is partnering with Dominion to explore the development of an SMR near Dominion’s North Anna nuclear power station. The collaboration is expected to bring at least 300 megawatts of power to the Virginia area, where Dominion is projecting an 85 percent increase in power demand over the next decade and a half.
In Washington, AWS is forging ties with Energy Northwest to fund the development and construction of four SMRs. The projects will use technology developed by X-energy, a leader in SMR design and nuclear fuel production.
Once operational, these reactors are expected to generate approximately 320 megawatts in the initial phase, with the potential to expand to 960 megawatts — enough to power over 770,000 homes.
Amazon will have the option to purchase power from these SMRs to support its operations in the Pacific Northwest.
AWS’ two investments form only part of its broader strategy to transition to sustainable energy sources.
In addition to its projects in Virginia and Washington, AWS has entered into an agreement with Talen Energy to purchase nuclear power from the Susquehanna Steam Electric Station in Pennsylvania.
“One of the fastest ways to address climate change is by transitioning our society to carbon-free energy sources, and nuclear energy is both carbon-free and able to scale — which is why it’s an important area of investment for Amazon,” AWS CEO Matthew Garman said in a Wednesday (October 16) press release. “Our agreements will encourage the construction of new nuclear technologies that will generate energy for decades to come.”
The development of SMRs is also expected to provide an economic boost to the regions involved.
Both the Washington and Pennsylvania SMRs are expected to generate a combined 1,000 temporary jobs during the building phase and another 1,000 permanent jobs once operations commence.
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Securities Disclosure: I, Giann Liguid, hold no direct investment interest in any company mentioned in this article.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
