Alphabet Inc. Class C (GOOGL.US) will purchase New Era Energy (NEE.US) to provide power for restarting nuclear power plants for AI data centers.

NextEra Energy, Inc. (NEE.US) plans to restart a nuclear power plant in Iowa, with its electricity primarily supplying Alphabet Inc. Class C (GOOGL.US) data center. According to a statement released on Monday, the Duane Arnold Energy Center is expected to start supplying power in 2029 after reaching an agreement with Alphabet Inc. Class C. The 615-megawatt nuclear power plant was shut down in 2020, well before the surge in demand for new types of electricity driven by the AI boom. The massive power demand of data centers is reshaping the energy industry, with tech companies rushing to connect large data centers to the grid. Mega-scale data center operators prefer nuclear energy for its ability to provide clean and uninterrupted power 24 hours a day. However, building new nuclear reactors takes several years. Restarting mothballed nuclear power stations is seen as a faster solution, although currently only a small number of them are considered feasible for restart. KeyBanc Capital Markets analyst Sophie Capu wrote in a research report, "The speed at which this deal was reached further demonstrates strong power demand, especially for baseload and zero-emission power." Constellation Energy Group (CEG.US) is progressing with the restart of a reactor at Three Mile Island in Pennsylvania, expected to be operational by 2027. Holtec International plans to restart the Palisades nuclear power station in Michigan early next year. Meanwhile, the South Carolina public utility Santee Cooper announced last week that it is in discussions with Brookfield Asset Management to complete the construction of the VC Summer nuclear power station, which was halted in 2017 due to cost overruns and remains unfinished. NextEra Energy has agreed to sell the electricity from the Duane Arnold Energy Center to Alphabet Inc. Class C for 25 years. The company will also acquire minority shareholders of the nuclear power plant - Central Iowa Power Cooperative and Corn Belt Power Cooperative, and will sell the remaining electricity to Central Iowa Power Cooperative under the same terms as Alphabet Inc. Class C. Alphabet Inc. Class C and NextEra Energy have also signed an agreement to explore new nuclear power projects. Currently, NextEra Energy has completed nearly 3,000 megawatts of energy projects in the United States in partnership with Alphabet Inc. Class C. After hours, NextEra Energy's stock price rose by 3.5% at one point. As of the time of writing, the stock had risen by 2.29% after hours.