Big tech companies are increasingly turning to nuclear power as a solution to meet their growing data center energy needs while adhering to their climate goals. This shift is particularly evident in the case of Microsoft, which recently entered into a deal with Constellation Energy to restart a nuclear reactor at Three Mile Island.
Background and Context
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Nuclear Reactors in the U.S.: In the last decade, the U.S. has seen a decline in nuclear power, with seven reactors decommissioned and only two new ones brought online. This decline is stark, especially considering the rapid growth in data centers, which now number over 10,000 worldwide, with half of them located in the U.S.
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Energy Demand Projections: The Energy Policy Research Institute (EPRI) predicts that the data center sector’s energy demand will grow by 29% to 166% by 2030. Currently, data centers consume about 4% of U.S. electricity, but this figure is expected to rise to 9% by the end of the decade, even as overall electricity demand continues to grow.
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Hyperscale Data Centers: Hyperscale data centers, operated by companies like Microsoft, Google, and Amazon, are the primary drivers of this energy demand. These facilities are responsible for 60 to 70% of all data center energy use.
Microsoft’s Commitment and Challenges
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Microsoft’s Ambitions: Microsoft has set a goal to eliminate its carbon emissions by 2030. However, the company’s carbon emissions have actually increased by 40% over the past four years, largely due to expanding data center operations.
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Google and Amazon: Google’s carbon emissions have also grown, increasing by 48% over the last five years. Amazon claims that all of its data centers’ energy use is matched by an equivalent amount of renewable power.
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Nuclear as a Solution: To reconcile their rapid data center growth with their climate goals, these companies are considering nuclear power. Nuclear fission reactors can operate at maximum capacity for years, with maintenance outages planned well in advance, providing stability and reliability.
Microsoft’s Move
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Constellation Energy Deal: Microsoft signed a 20-year agreement with Constellation Energy to restart a nuclear reactor at Three Mile Island. This move is seen as a strategic decision to secure long-term, reliable energy for its data centers.
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Investments in Nuclear Technology: Microsoft has also invested in Last Energy, a company planning to build small modular reactors. This investment underscores the company’s commitment to exploring various nuclear power solutions.
Other Big Tech Companies
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Amazon: Amazon recently bought a hyperscale data center directly connected to a nuclear plant and is hiring a nuclear engineer to help develop and acquire nuclear power. The company’s actions reflect a broader trend within the tech industry.
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Investor Involvement: Notable tech industry figures, such as Bill Gates (co-founder of TerraPower and a significant investor in the company) and Nathan Myhrvold (through Intellectual Ventures), have invested in nuclear power ventures. Sam Altman, CEO of Anthropic, has backed small modular reactor startups like Oklo.
Conclusion
The embrace of nuclear power by big tech companies is driven by the need for reliable, low-carbon energy to support the rapid growth of data centers. While the shift is significant, it also presents challenges, including regulatory hurdles and public perception. As the tech industry continues to grow, the role of nuclear power in meeting its energy needs will likely become more prominent.
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