Amazon Web Services has secured a landmark 20‑year power purchase agreement with Talen Energy, guaranteeing 1,920 MW of carbon‑free electricity from the Susquehanna nuclear plant in Pennsylvania. The contract, lasting until 2042 with extension options, positions nuclear energy as a pillar of Amazon’s strategy to meet surging demand from its AI and cloud operations.
Talen will gradually ramp up delivery, starting with 840–1,200 MW by 2029 and reaching full capacity no later than 2032, under a “front‑of‑the‑meter” model routed through the PJM grid. This model, to commence after transmission upgrades around spring 2026, can mitigate regulatory concerns and help distribute infrastructure costs across consumers.
The agreement marks a significant shift for both companies. Amazon’s Vice‑President of Global Data Centers, Kevin Miller, described the deal as “the largest private‑sector investment in state history – $20 billion – to bring 1,250 high‑skilled jobs and economic benefits to the state”. Talen’s chief executive, Mac McFarland, emphasised that the pact would “provide a long‑term, steady source of revenue,” reducing market risk and reliance on federal tax credits.
The alliance between Amazon and Talen bolsters economic and political support. Pennsylvania Governor Josh Shapiro praised the initiative as powering “the largest economic development project in Commonwealth history,” while workforce representatives hailed its job‑creation potential. The project underlines Pennsylvania’s role as a net energy exporter, offering stability and fresh investment in grid infrastructure.
This deal follows a previous data‑centre campus sale from Talen to AWS for $650 million in 2024, which included a 300 MW co‑location setup. Now, with a long‑duration full‑scale supply, the partners are also investigating uprating Susquehanna’s output and launching small modular reactors on‑site — a move aligned with global clean‑energy trends.
Market reaction was immediate: Talen’s share price jumped between 4.7 % and nearly 8 % following the announcement, and the stock surge also lifted other nuclear‑related equities. The U.S. is seeing renewed interest in nuclear power, driven by Big Tech’s appetite for stable, low‑carbon electricity. Recent arrangements include Constellation’s reactor restart for Microsoft and Meta’s extension deals, alongside broader calls, including from the World Bank, to triple nuclear capacity by 2050.
From a technical standpoint, Susquehanna — a dual‑unit boiling‑water reactor with 2.5 GW capacity and licenses extending into the 2040s — is ideally suited for long‑term data centre supply. Its high capacity factor makes it one of the most cost‑effective U.S. nuclear plants, producing approximately 19,943 GWh in 2021. Transitioning to front‑of‑the‑meter allows Amazon to benefit from PJM market dynamics, while Talen steps into a retail‑supply role alongside PPL Electric Utilities, which will handle transmission.
Regulatory challenges remain. A previous FERC‑rejected interconnection plan illustrates the delicate balance of dealing directly with the power grid, and conversions to front‑of‑meter mark a regulatory‑savvy pivot. These concerns are echoed in other jurisdictions where data centres strain regional grids and call for policy adaptations.
Strategically, this partnership addresses Amazon’s deepening energy needs. AWS’s AI workloads are propelling exponential electricity demand, and while renewables are a core part of Amazon’s clean energy portfolio, nuclear offers unmatched reliability and controllability. Amazon previously hit its 100 % renewable electricity goal in 2024, but anticipated that generative AI growth would necessitate new clean energy sources.
By investing in nuclear, Amazon gains long‑term price stability and carbon‑free output. Talen realistic earnings projections suggest $18 billion in revenue over the duration of the deal. The utilities sector sees value, too: PPL’s Christine Martin noted upfront infrastructure investment lowers transmission costs for all consumers, fostering grid resilience.
This agreement further cements nuclear’s role in the emerging clean energy toolkit for digital infrastructure. While no new large reactors are under construction in the U.S., the rising interest in SMRs, uprates, and even nuclear restarts reflects a shift in energy strategy. As data‑centre demand soars and state‑of‑play changes, nuclear energy’s stability and scalability may define future power contracts.
