New Era Energy plans to restart a nuclear power plant in Iowa, and its power will mainly supply Google data centers. The Duane Arnold Energy Center is expected to begin providing power in 2029 following an agreement with Google, according to a statement released on Monday. The 615-megawatt nuclear power plant went offline in 2020, long before the artificial intelligence boom created new demand for electricity.
The huge power demands of data centers have reshaped the energy industry, and technology companies are scrambling to connect large data centers to the grid. Hyperscale data center operators favor nuclear power because it provides clean, 24-hour power.
But building a new nuclear reactor will take years. Restarting mothballed nuclear power plants is seen as a quicker solution, but only a handful of them currently appear to be feasible.
"The speed with which this deal was completed is further evidence of the strength of power demand, particularly for baseload and zero-emission power," KeyBanc Capital Markets analyst Sophie Karp wrote in a research note.
Constellation Energy is moving forward with restarting a reactor at the Three Mile Island nuclear power plant in Pennsylvania, which is expected to be operational in 2027. Holtec International plans to restart the Palisades nuclear power plant in Michigan early next year.
Meanwhile, South Carolina utility Santee Cooper said last week it was in talks with Brookfield Asset Management to complete construction of the VC Summer nuclear power plant - a project that was halted in 2017 due to soaring costs and remains unfinished.
New Era Energy has agreed to sell power from the Duane Arnold Energy Center to Google for 25 years. The company will also acquire the shares of the plant's minority shareholders, Central Iowa Power Cooperative and Corn Belt Power Cooperative, and will sell the plant's remaining power to Central Iowa Power Cooperative on the same terms as Google.
Google and New Era Energy also signed an agreement to explore and develop new nuclear power generation projects. Currently, New Era Energy has completed nearly 3,000 megawatts of energy projects in cooperation with Google in the United States. After the U.S. stock market closed, New Era Energy's share price rose as much as 3.5%. As of press time, the stock rose 2.29% after hours.