By Timothy Gardner, Valerie Volcovici and Leah Douglas
WASHINGTON (Reuters) – President Joe Biden’s administration is asking major technology companies to invest in new climate-friendly energy generation to meet their rising demand, U.S. Energy Secretary Jennifer Granholm told Reuters.
The talks come as a surprising increase in electricity demand is driven by the adoption of technologies such as generative artificial intelligence, which require energy-hungry data centers. The development could complicate Biden’s goal of decarbonizing the energy sector by 2035 to fight climate change.
“We have spoken to data companies. The big companies have commitments to reach net zero and would like to see clean baseload energy,” Granholm said in an interview with Reuters.
She said the government had discussed the possibility that companies could work together to use small modular reactors for nuclear power, while placing orders to reduce costs.
“If the tech companies come in and start taking clean power off the grid, they have to take the power with them,” she said.
“And so a lot of that conversation right now is happening between technology companies and utilities, technology companies and nuclear companies.”
She did not name any of the companies involved.
Data centers could consume up to 9% of total U.S. electricity production by the end of this decade, which would more than double their current consumption, the Electric Power Research Institute said in a report last week.
NuScale, the only small modular reactor company with a construction license from U.S. regulators, had to cancel its only project at the Energy Department’s Idaho National Laboratory last year.
Granholm said NuScale did not have sufficient agreements to purchase power from the project. “That’s a lesson: If you want to have new nuclear power, you have to have a clear reduction in power,” Granholm said.
The White House last week announced new measures to boost the development of new U.S. nuclear power plants, a major potential source of carbon-free electricity that the administration says is needed to fight climate change. But no new U.S. nuclear power plants are currently being built.
The youngest U.S. nuclear reactors, at the Vogtle plant in Georgia, were years behind schedule and billions over budget when they entered commercial service in 2023 and 2024.
Granholm said tech companies are also exploring other clean energy technologies, including geothermal.
(Additional reporting by Nichola Groom, David Shepardson and Richard Valdmanis; Editing by David Gregorio)
