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A nuclear power purchase agreement (PPA) can secure long-term electricity associated with a nuclear plant, but signing one does not by itself connect a data center to that plant or guarantee power during an outage. The practical result depends on the delivery point, transmission service, capacity and energy obligations, backup arrangements, and the plant’s operating status.
Evaluate the contract and the physical grid arrangement together. First determine whether the deal is a conventional, grid-delivered PPA or a physically co-located/behind-the-meter configuration. Then test the quantity, outage, curtailment, transmission, cost-allocation, environmental-attribute, and schedule provisions against the data center’s actual load profile.
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What a nuclear PPA actually provides
A PPA is a commercial agreement for electricity supply or the financial and environmental attributes associated with generation. The label “nuclear PPA” does not answer where electricity physically flows, who schedules it, which transmission services apply, or what happens when the plant cannot produce. Those terms are established by the PPA, interconnection and transmission arrangements, utility tariffs, and applicable regulations.
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1Fix the driver behind crashes, sound loss and screen glitches2Clear out junk files and repair common Windows errors3Scan for outdated or missing drivers - takes under a minuteThe U.S. Energy Information Administration (EIA) explains that a PPA does not require the generator and data center to occupy the same site, and it does not require generation and consumption to occur at the same moment. In a conventional structure, the plant delivers into the regional grid while the data center takes service through its utility or market interface. The contract can match the buyer financially or contractually to nuclear output without creating a private wire between the two facilities.
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Physical co-location is a different arrangement. A load may sit on or next to a generating site and use a dedicated connection, a behind-the-meter configuration, or another approved service design. That setup raises separate questions about withdrawals from the grid, curtailment, metering, protection, operating responsibility, and transmission charges. A PPA can accompany co-location, but it is not what creates the physical connection.
Choose the physical structure before negotiating price
Grid-delivered PPA
In a grid-delivered deal, the nuclear facility injects electricity into the transmission or distribution system. The data center receives electricity under its utility or market service, subject to congestion, losses, balancing rules, and any load-serving or transmission contract. The PPA specifies the commercial relationship with the generator; it does not replace the data center’s obligation to obtain physical delivery and grid access.
This structure can work when the facility is far from the plant or when the operator wants a nuclear-linked supply contract without changing its interconnection. It also means the operator must understand how the PPA settles against actual consumption. A contract for a fixed volume may leave the buyer buying additional power from the market when load exceeds the contracted amount, or selling excess volume when load is lower.
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Co-located or behind-the-meter supply
Co-location places the load and generator at the same site or behind a common point of interconnection. The design may reduce some dependence on the wider grid, but it does not eliminate grid obligations. The project still needs an approved electrical configuration, metering, protection, operating protocols, and a defined treatment for periods when generation is unavailable or load exceeds on-site output.
Federal Energy Regulatory Commission (FERC) proceedings in the PJM region show why the details matter. FERC has considered distinct service paths for large co-located loads, including network integration service, interim non-firm service, and proposed firm or non-firm contract-demand services. A non-firm option can expose the data center to curtailment when the grid or contract rules require it. The applicable tariff and project-specific filings, rather than the word “co-location,” determine the result.
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| Decision axis | Grid-delivered PPA | Co-located or behind-the-meter configuration |
|---|---|---|
| Physical delivery | Plant and data center use the grid; no same-site requirement. | Load is electrically connected to the generator or common site infrastructure. |
| Grid dependence | Normal imports, balancing, congestion and utility service remain central. | Grid imports may be reduced or specially limited, but backup and withdrawal rules still apply. |
| Transmission service | Existing utility or market transmission arrangements generally govern. | Specific firm, non-firm, behind-the-meter or contract-demand treatment may be required. |
| Outage exposure | Grid service can provide replacement power, subject to availability and price. | Replacement imports, curtailment and islanding capabilities must be expressly engineered and contracted. |
| Cost allocation | Charges follow the buyer’s utility, market and transmission arrangements. | Interconnection, upgrades, reserved withdrawals and reliability costs require project-specific allocation. |
Do not confuse contracted megawatts with delivered energy
Data center negotiations often begin with a megawatt figure, but MW can describe several different obligations: peak demand capability, a staged capacity reservation, an annual energy entitlement, a minimum offtake, or a right to expand. The PPA must define which interpretation applies and how it is measured.
EIA reported that Amazon Web Services contracted for capacity from the Susquehanna nuclear plant of up to 960 MW, added in 120-MW increments over multiple years. The report also described a one-time option to cap the commitment at 480 MW. Those figures describe the reported contractual capacity structure, not a claim that 960 MW of electricity was immediately delivered or continuously consumed.
For a data center, translate the load forecast into at least four separate quantities:
- Peak MW: the highest instantaneous demand, including cooling and power-conversion equipment.
- Firm or reserved MW: the capacity the seller or grid must make available under defined conditions.
- Energy volume: MWh consumed over an hour, month or contract year.
- Ramp and flexibility: how quickly the load can increase, decrease or be curtailed.
Ask whether the buyer must take a minimum amount, whether unused capacity can be resold, and whether expansion rights are automatic or subject to transmission and interconnection approval. A staged ramp can align a nuclear contract with construction phases, but only if the plant, grid and data center schedules are coordinated.
Deal examples and what their numbers do—and do not—mean
| Announced arrangement | Reported figure | Correct interpretation |
|---|---|---|
| Constellation Energy–Microsoft, announced September 2024 | 20-year PPA for Microsoft data centers in the mid-Atlantic | Long-term contract associated with a proposed restart of Three Mile Island Unit 1; not proof that the unit was operating or delivering power when announced. |
| Talen Energy–Amazon Web Services, reported by EIA in 2024 | Up to 960 MW, in 120-MW increments; one-time cap option at 480 MW | Contracted capacity structure, not a guaranteed instantaneous energy delivery figure. |
| Amazon–Talen transaction, described by the U.S. Department of Energy in March 2024 | $650 million | DOE described this as the purchase of a co-located data center and up to 960 MW from Susquehanna. It is not an electricity-only price or a market-wide PPA benchmark. |
These announcements are examples, not a standard term sheet. They do not establish a typical nuclear PPA price, duration, capacity or escalation formula for other buyers.
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Plan for maintenance, forced outages and delayed restarts
Nuclear plants are designed for sustained operation, and EIA has noted that their relatively continuous output can align with the steady demand profile of a large data center. That alignment is useful but does not make one reactor an outage-proof supply plan. A single-resource strategy can expose a mission-critical facility to planned refueling outages, unplanned trips, grid constraints or a prolonged licensing and repair process.
Scheduled maintenance
Require an outage calendar, notice periods and a replacement-energy process. The contract should identify whether the seller supplies replacement power, pays a defined difference, permits the buyer to nominate another source, or merely excuses performance. Do not assume that “firm” means the plant itself will run continuously; determine what firmness applies to physical energy, financial settlement or capacity.
Forced outage
Define the hierarchy among grid imports, independent generation, battery systems, load shedding and curtailment. Confirm who controls emergency switching and how much time the data center has to reduce load. A remedy that works for an ordinary commercial load may be inadequate for services that cannot tolerate interruption.
Restart or licensing delay
EIA’s October 1, 2024 account described Constellation’s then-announced plan to restart Three Mile Island Unit 1 in 2028, subject to Nuclear Regulatory Commission and state and local approvals and substantial plant work. Treat 2028 as the target reported at that date, not as a verified current operating date. A data center energization schedule should include milestones for license approvals, construction, testing, fuel and commercial operation, with a contingency supply if any milestone slips.
Transmission service, curtailment and who pays
Co-location can change the amount and type of transmission service a project needs. It can also change which party is responsible for network upgrades, protection systems, metering, studies and reserved capacity. A project that expects to take little power from the grid during normal operation may still need substantial import capability for outages or periods when load exceeds generation.
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In February 2025, FERC opened a PJM-focused review of co-located generation and load, citing uncertainty about tariff rates, terms and conditions. In a later directive, FERC found the PJM tariff insufficiently clear and required revisions addressing service choices, behind-the-meter rules, reliability reporting and filing deadlines. The directive described options including network integration service, interim non-firm service, and new firm or non-firm contract-demand service.
Commissioner Rosner’s December 18, 2025 concurrence explained that the directive “directs PJM to establish new pathways for co-location—directly connecting a large load with the power needed to serve it at the same site—and load flexibility that enable large co-located loads to reduce how much they lean on the grid, while ensuring that they pay their fair share.” The service selected can affect permitted withdrawals, curtailment exposure and charges.
FERC Chairman Mark Christie said in the Commission’s February 20, 2025 announcement: “Co-location arrangements are a fairly new phenomenon that entail huge ramifications for grid reliability and consumer costs.” That statement reflects an unsettled policy debate, not a finding that every co-location project lowers costs or shifts them to other customers. The final allocation depends on the effective tariff, interconnection agreement, state rules and utility arrangements.
The reviewed material does not establish whether every post-order PJM filing and reliability-reporting step due in 2026 has been completed, or what final rates apply to a particular project. Verify the current FERC docket, PJM tariff and local requirements before committing capital.
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Existing operating plant
An operating reactor may offer a clearer production history, but the buyer still needs to review planned outages, license conditions, uprates, cooling-water constraints and remaining operating life. Existing generation can also require different interconnection treatment from a new generator.
Restart project
A restart combines a commercial contract with regulatory and construction risk. Confirm the status of NRC approvals, state and local permits, equipment refurbishment, fuel procurement, testing and the proposed commercial-operation date. Tie data center payments and expansion milestones to objective project events rather than an announcement date.
New build
A new reactor or other new generation project introduces longer development, financing, licensing, supply-chain and interconnection schedules. The contract should specify what happens if the project is delayed, resized or cancelled and whether the buyer has interim replacement rights.
Contract diligence checklist for operators
- Map the physical arrangement. State whether the PPA is grid-delivered, co-located or behind the meter. Identify the delivery point, meters, interconnection facilities and the parties responsible for scheduling and settlement.
- Define every quantity. Label peak MW, reserved MW, annual MWh, minimum take, expansion blocks, ramp rates and any cap or reduction option. Do not accept a single undifferentiated MW number.
- Model normal and abnormal operations. Run cases for full output, partial output, scheduled maintenance, forced outage, fuel or plant constraints, transmission congestion, data center overrun and delayed commercial operation.
- Secure replacement power. Specify grid-import rights, independent backup generation, storage, curtailment priority, notice periods, financial remedies and restoration procedures.
- Confirm the tariff path. Identify the applicable firm or non-firm service, allowed withdrawals, curtailment rules, reservation charges, network upgrades and any reporting obligations. Use the effective tariff, not a draft concept or press release.
- Separate existing and new generation treatment. Ask whether the project relies on an existing generator, a restart or a new interconnection, and require the reliability studies and upgrades associated with that status.
- Align schedules. Compare the plant’s license, construction, restart and commercial-operation milestones with the data center’s energization and tenant commitments. Add a documented interim supply plan.
- Specify environmental claims. Define which renewable or nuclear attributes, emissions accounting instruments or certificates are transferred, who retires them, and what claims the buyer may make. There is no universal treatment; the contract must say.
- Allocate imbalance and congestion risk. State who pays for deviations between contracted and metered energy, congestion, losses, ancillary services and market-price differences.
- Obtain regulatory and local review. Have energy counsel and the relevant utility or transmission provider confirm that the proposed structure is permitted in the project’s jurisdiction.
A practical decision framework
Choose a grid-delivered PPA when the priority is long-term nuclear-linked procurement and the existing utility connection can provide reliable physical service. Choose co-location only when the benefits of a dedicated configuration justify additional engineering, tariff, reliability and regulatory work. In either case, require an outage plan that works without assuming the reactor will always be available.
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