With energy scarcity threatening to derail datacenter ambitions, cloud providers are looking for salvation in the atom.
On Wednesday, Amazon announced plans to support the development of three new nuclear energy projects, which it says will see the construction of several new small modular reactors (SMRs).
Just as their name suggests, SMRs are miniaturized nuclear power plants designed to be mass produced in a modular fashion. Amazon touts “faster build times” and the ability to deploy them “closer to the grid” as major benefits.
While there are several startups developing SMRs, including NuScale and Sam Altman-backed Oklo, Amazon is betting big on X-energy’s SMR tech for the Washington development. The e-tailer is one of the major investors in a $500 million Series-C funding intended to accelerate the development of X-energy’s tech and will reportedly support its goal of bringing more than 5 gigawatts of SMRs online in the US by 2039.
“Nuclear is a safe source of carbon-free energy that can help power our operations and meet the growing demands of our customers, while helping us progress toward our Climate Pledge commitment to be net-zero carbon across our operations by 2040,” AWS CEO Matt Garman said. “Our agreements will encourage the construction of new nuclear technologies that will generate energy for decades to come.”
While the individual SMRs may be tiny compared to the massive pressure water nuclear reactors (PWR) with their signature cooling towers, put enough of the modular units together and they can produce nearly as much power — in theory, at least.
The cloud titan plans to develop four “advanced SMRs” in Washington State that will be owned and operated by partner Energy Northwest, which represents numerous state public utilities in the region.
The four reactors are expected to generate about 320 megawatts of power during the first phase of the project or about a third of the output of a typical PWR.
A scale model of X-energy’s SMR design. – Click to enlarge
X-energy’s Xe-100 reactors are designed to produce around 80 megawatts of power apiece using TRISO-X fuel developed in collaboration with the Department of Energy.
Amazon claims its Washington SMR deployments could eventually grow to 12 SMRs totaling 960 megawatts over the course of the project, enough to power 770,000 US homes.
To put things into perspective, assuming a power use effectiveness of 1.1, we estimate a 960 megawatt datacenter campus could support upwards of 7,000 of Nvidia’s 120 kilowatt Grace-Blackwell NVL72 rack systems — or about half a million GPUs. To be clear, we’re just speculating here and there’s no guarantee that Amazon will have access to the full capacity of these reactors; they may have to split it with local municipalities.
The tech giant says the project will create up to 1,000 temporary construction jobs and 100-plus permanent jobs once the SMR project is fully operational.
Amazon has also signed an agreement with Dominion Energy to explore the development and deployment of SMRs near Dominion’s North Anna nuclear power station. If the project moves forward, Amazon anticipates SMRs could bring an additional 300 megawatts of power to the datacenter-packed Virginia region.
It’s not clear when exactly these SMRs will start producing power, but by the sounds of it, the e-tailer is targeting the early 2030s.
SMR salvation
AWS is far from the only cloud provider looking to itty bitty nuclear reactors to overcome grid limitations. Early this year, Microsoft hired a director of nuclear technologies to oversee the development of SMRs to power its datacenters. Prior to that, Redmond signed a power purchase agreement with Sam Altman-backed fusion-energy startup Helion, which will supposedly start supplying the software giant with power sometime around 2028. That’s if, of course, their reactor ever manages to produce power.
Meanwhile, in September, software giant Oracle announced it had secured building permits for a trio of SMRs to power a datacenter with over a gigawatt of AI compute capacity. Unfortunately, Oracle founder and chair Larry Ellison didn’t go into detail as to who would be building them and when they might come online.
Google, not to be left behind, has its own nuclear ambitions. On Monday the ad and search giant said it planned to purchase nuclear energy from SMR outfit Kairos Power. However, just like other SMR projects we’ve covered, it’s going to be a while before Google gets its hands on that sweet, sweet atomic energy.
As we reported earlier this week, Kairos doesn’t actually have a working reactor yet. It did break ground on a test facility earlier this year, which it aims to have operational in 2030, but says commercial reactors capable of producing 150 megawatts probably won’t arrive until at least 2035.
Under the deal with Kairos, Google will need three or four of these reactors in order to supply the 500 megawatts of carbon-free energy it’s signed up for.
Long development times aren’t the only challenge facing SMRs. Regulatory hurdles, and high costs also remain barriers to adoption.
With the stigma attached to nuclear energy, whether fear of a meltdown, radiological release, or nuclear waste, the companies championing SMRs have a lot of red tape to jump through before anyone will be allowed to connect them to the grid.
What’s more, there are questions as to whether SMRs will ever be cost effective. Back in May, the Institute for Energy Economics and Financial Analysis concluded that SMRs were “too expensive, too slow to build, and too risky to play a significant role in transitioning away from fossil fuels.”
High costs have already foiled early SMR projects, like NuScale’s planned plant in Utah, which would have used six of its tiny reactors to churn out 462 megawatts of juice. Unfortunately, the project was abandoned after several municipalities pulled out of the deal over rising costs.
Hedging bets on aging reactors
While cloud providers, like Amazon, await their SMR salvation, many are working to preserve existing reactors.
Back in March 2024, Amazon acquired Cumulus Data’s atomic datacenter complex, colocated alongside the 2.5 gigawatt Susquehanna nuclear power plant in northeast Pennsylvania from Talen Energy for $650 million.
Under the deal, the tech giant will have access to between 480 and 960 megawatts to power a sprawling campus with at least 15 datacenters.
Amazon isn’t alone in this endeavor either. In September, Microsoft announced it’d signed a 20-year power purchase agreement with Constellation Energy to bring the shuttered Three Mile Island Unit 1 nuclear plant back online.
And before anyone asks, no, this isn’t the same Three Mile Island facility that had a partial meltdown back in the late ’70s. That happened next door at the TMI Unit 2 reactor. The Unit 1 plant has operated safely for decades, but was decommissioned in 2019 due to a lack of funding.
With an output of 837 megawatts, that should be plenty of energy to keep Microsoft’s GPU-bit-barns humming along while it gets its own SMR strategy in order and crosses its fingers that its bet on Helion pays off. ®