The FERC decision is “a major setback for the nuclear data centre thesis,” Jefferies LLC analysts said. — Bloomberg
NEW YORK: Talen Energy Corp and other US power company stocks slumped in pre-market trading Monday following the rejection by the country’s top energy regulator of Talen’s plan to supply a data centre.
The Federal Energy Regulatory Commission (FERC) voted two-to-one late Friday against the proposal that would have increased the amount of power supplied to an Amazon.com Inc. data facility adjacent to Talen’s Susquehanna nuclear plant in Pennsylvania.
Talen tumbled as much as 15% before the start of regular trading in New York.
Vistra Corp fell as much as 7.5% and Constellation Energy Corp 14%.
All three companies have seen their shares more than double this year amid very bullish predictions for artificial intelligence-driven power consumption.
“Talen believes FERC erred and we are evaluating our options, with a focus on commercial solutions,” the company said Monday in a statement.
Talen said the Susquehanna plan is “in the best interest of consumers. FERC’s decision will have a chilling effect on economic development in states such as Pennsylvania, Ohio and New Jersey”.
Amazon Web Services paid Talen US$650mil in March for a 960 megawatts (MW) data centre campus adjacent to Susquehanna, and signed a long-term agreement to buy power from the plant.
The FERC decision is “a major setback for the nuclear data centre thesis,” Jefferies LLC analysts led by Julien Dumoulin-Smith said in a note.
In June, PJM Interconnection, which operates the eastern US grid, sought approval from FERC to increase the amount of power used onsite at Susquehanna to 480MW from 300MW. — Bloomberg
