A cooling tower is seen at the Three Mile Island Nuclear power plant, during a tour by Constellation Energy, which has ordered a main power transformer for the nuclear reactor it is trying to reopen, in Middletown, Pennsylvania, U.S., October 16, 2024. REUTERS/Shannon Stapleton
NEW YORK (Reuters) -Constellation Energy is increasingly focused on potential data center projects that connect to the U.S. electrical grid in a pivot away from the company's previous emphasis on fueling the giant server warehouses directly from its power plants, company executives said on Tuesday.
Big Tech's race to secure huge amounts of electricity to fuel its artificial intelligence expansion has led to new types of deals with power companies, including so-called co-located arrangements that link AI data centers directly to nuclear plants, instead of waiting in line to connect to the grid.
Those co-located data center projects have faced recent regulatory push-back over the potential for rising power bills and grid reliability impacts caused by diverting electricity from the grid to serve single customers like data centers.
"On-grid sales are increasingly attractive to us and to our customers," Constellation CEO Joseph Dominguez said on an call with investors. "I do want to make clear that we still believe that behind-the-meter configurations will make sense for some customers."
After ruling against a proposed expansion of an Amazon data center connected to a Talen Energy nuclear site, the Federal Energy Regulatory Commission is currently considering new rules for around co-located power projects.
Constellation, which is the largest operator of nuclear power plants, had said in FERC filings that it was considering co-located, and off-the-grid, data center projects at several of its nuclear reactor sites.
(Reporting by Laila Kearney; Editing by Will Dunham)
