Nuclear power is emerging as the go-to energy source for artificial intelligence data centers, and one utility company is positioned to dominate this shift. Constellation Energy, which operates 21 nuclear reactors across the United States, has locked in power purchase agreements with tech giants Microsoft and Meta to fuel their AI infrastructure. The reason is straightforward: AI inference, the process that powers chatbots and recommendation systems, is extraordinarily power-hungry, and nuclear plants can deliver reliable, carbon-free electricity around the clock .

The numbers tell the story. U.S. electricity demand is projected to grow 2.5% annually over the next decade, a pace five times faster than the previous decade, according to Bank of America analysis. Data centers are the primary driver of this surge . Global data center power demand is expected to double by 2030, and some estimates suggest U.S. data centers could consume as much as 12% of domestic electricity by 2028, up from just 4.6% in 2023 .

Why Are Tech Companies Turning to Nuclear Energy?

For hyperscalers like Microsoft and Meta, nuclear power offers a compelling combination of benefits. Unlike solar or wind farms, nuclear plants generate baseload power, meaning they run continuously regardless of weather conditions. They also produce zero carbon emissions during operation, which aligns with corporate sustainability commitments. Most importantly, they can deliver the massive, uninterrupted power supply that modern AI systems demand .

Constellation Energy's geographic advantage amplifies this appeal. Many of its reactors are located in the PJM Interconnection region, which spans the Mid-Atlantic and Midwest. This region is experiencing rapid growth in AI data center construction, and peak demand there is forecast to grow by 35 gigawatts over the next five years . That's equivalent to the power needs of millions of homes, all driven by the expansion of AI infrastructure.

What Specific Projects Are Already in Motion?

Constellation has moved beyond agreements to concrete projects. The company plans to restart the Crane Clean Energy Center, formerly known as Three Mile Island Unit 1, around 2027 to 2028 as part of its deal with Microsoft . This represents a symbolic moment: the site of America's most famous nuclear accident is being revived to power the future of artificial intelligence.

The company's expansion plans extend across multiple facilities:

• Three Mile Island Restart: Constellation will bring the Crane Clean Energy Center online between 2027 and 2028 under its Microsoft agreement, providing dedicated power for AI infrastructure.
• Clinton Facility Expansion: Its agreement with Meta for the Clinton Clean Energy Center in Illinois takes effect in June 2027, with plans to add 30 megawatts of capacity by the 2030s.
• Broader Capacity Growth: Over the next five years, Constellation plans to add 9,350 megawatts of capacity through license extensions and upgrades to existing reactors across its fleet.

These projects represent billions in investment and underscore how seriously tech companies are betting on nuclear as their energy solution .

How Are Tech Companies Funding This Nuclear Expansion?

A critical detail distinguishes this moment from previous energy infrastructure debates: tech companies are footing the bill. Under what industry observers call a "bring your own power" model, Microsoft, Meta, and other hyperscalers are directly funding the construction of new generation capacity and paying for grid upgrades themselves, rather than passing these costs to everyday utility customers .

This arrangement protects consumers from bearing the financial burden of AI infrastructure expansion. However, it also creates regulatory uncertainty. Potential price caps or new regulations could limit how much Constellation and other utilities can charge for their power, which represents a risk to their profitability .

What Does This Mean for Constellation Energy's Financial Future?

Constellation Energy is targeting earnings-per-share growth of 20% or more through 2029, with analysts projecting non-GAAP earnings per share could reach $19.79 by 2029. The company has also committed to growing its annual dividend by 10% . These are aggressive targets for a utility company, reflecting confidence in sustained demand from AI data centers.

The stock currently trades at 19.8 times this year's projected earnings, which is expensive by traditional utility standards. But for investors bullish on the long-term trajectory of AI infrastructure, the valuation reflects a company positioned at the intersection of two unstoppable trends: the explosive growth of artificial intelligence and the urgent need for reliable, clean energy .

The broader implication is clear: the race to power AI is reshaping America's energy landscape. Nuclear, once considered a relic of the 20th century, is experiencing a renaissance as the technology industry's preferred solution to an unprecedented power challenge. Constellation Energy's deals with Microsoft and Meta signal that this shift is not theoretical; it is already underway.