Factbox: Microsoft deal signals booming demand from data centers to power AI

Xcel Energy

05/12/2024 17:51

(Adds Entergy-Meta power supply deal)
       Dec 5 (Reuters) - U.S. utilities are finally signing
concrete supply deals with data-center operators as the
artificial-intelligence wave sparks a surge in power demand,
paving the way for higher profits in the coming quarters.
    Data centers are expected to account for 8% of the power
generated in the U.S. by 2030, compared with 3% in 2022,
according to a Goldman Sachs report in May.
    Here are some deals announced by utilities in 2024:
    
    Constellation Energy  CEG.O  signed an exclusive deal with
Microsoft  MSFT.O  to restart one of the units at the Three Mile
Island nuclear plant in Pennsylvania.
    Under the agreement, the utility will provide 835 megawatts
(MW) of energy to the tech giant's data centers. The deal would
also mark the first ever restart of a nuclear power plant in the
U.S. after it was shut down.
    
    Ameren  AEE.N  signed a supply deal with a data center with
a power capacity of 250 megawatt (MW). It has also received
expansion commitments and executed new contracts for more 85 MW
of additional load for smaller data centers and other industries
across Missouri and Illinois.
    
    Alliant Energy  LNT.O  said it has executed multiple power
supply deals with data centers, but did not disclose details.
    
    Exelon  EXC.O  said it is in the engineering phase for more
than 5 GW of data center capacity. Some data-center customers
have also made deposits for ComEd - Exelon's subsidiary - to
order transmission and breakers, the firm said during a
post-earnings call. 
    
    American Electric Power  AEP.O  signed letters of intent to
power an additional 15 GW of data centers by the end of the
decade.
    
Xcel Energy  XEL.O  will supply power to Meta Platforms'
 META.O  data center in Minnesota, expected to come online in
late summer 2025. 
    
Entergy  ETR.N  has received legislative approval for investment
in transmission and generation to serve Amazon's  AMZN.O 
upcoming Amazon Web Services (AWS) facility in Mississippi.
    The utility has also signed a deal with Meta  META.O  to
supply power to the Facebook-parent's hyperscaler data center
located in Louisiana. The center would be Meta's largest data
center in the world.
   
Pinnacle West Capital  PNW.N  has more than 4,000 MW of
committed data center customers, not including the backlog of
more than 10,000 data center requests it has received. 
    
AES  AES.N  signed an agreement with Google  GOOGL.O  for 310
megawatts to support its Ohio data centers.
    It further expanded a previously announced partnership with
Google and signed a 15-year power purchase agreement for 727
megawatts in Texas. 

Talen Energy  TLN.O  announced a deal to supply electricity and
its 960-megawatt data center campus to Amazon's AWS in
Pennsylvania. 
    
    NextEra's renewables segment saw a rise of 3 gigawatts (GW)
worth of renewables and storage projects in second quarter,
including Google's 860 megawatts (MW) demand for its data center
power.

 (Reporting by Vallari Srivastava in Bengaluru; Editing by
Sriraj Kalluvila)
 ((Srivastava.Vallari@thomsonreuters.com;))