Amazon to spend $20 billion on data centers in Pennsylvania, including one next to a nuclear power plant

Amazonsaid Monday that it will spend$20 billionon two data center complexes inPennsylvania, including one it is building alongside a nuclear power plant that has drawnfederal scrutinyover an arrangement to essentially plug right into the power plant.

Kevin Miller, vice president of global data centers at Amazon’s cloud computing subsidiary,Amazon Web Services, toldThe Associated Pressthat the company will build another data center complex just north ofPhiladelphia.

One data center is being built next to northeasternPennsylvania’sSusquehannanuclear power plant. The other will be inFairless Hillsat a logistics campus, theKeystone Trade Center, on what was once aU.S.Steel mill.

In a statement, Gov.Josh Shapirocalled it the largest capital investment inPennsylvania’shistory.

The announcements add to the billions of dollars in Big Tech’s data center cash already flowing into the state.

Since 2024 started,Amazonhas committed to about$10 billionapiece to data center projects inMississippi,Indiana,OhioandNorth Carolinaas it ramps up its investment in infrastructure to compete with other tech giants to meet growing demand for artificial intelligence products.

The rapid growth of cloud computing andartificial intelligencehas fueled demand for data centers that need power to run servers, storage systems, networking equipment and cooling systems.

The majority owner of theSusquehannanuclear power plant,Talen Energy, announced last year that it had sold its data center toAmazonfor$650 millionin a deal to eventually provide 960 megawatts. That’s 40% of the output of one of the nation’s largest nuclear power plants, or enough to power more than a half-million homes.

However, the arrangement between Talen andAmazon— called a “behind the meter” connection — has been held up by theFederal Energy Regulatory Commissionin the first such case to come before the agency.

It has raised questions over whether diverting power to higher-paying customers will leave enough for others and whether it’s fair to excuse big power users from paying for the grid.

For Big Tech, plugging energy-hungry data centers directly into a power plant can take years off their development timelines and is a much faster route to procuring power than having to connect to the congested electricity grid.

It’s not clear whenFERC, which blocked the deal on a procedural grounds, will decide the matter, leaving in limbo regulatory treatment of the deal and others that likely would follow.

Already inPennsylvania,Microsoftannounced a deal with the owner of the shutteredThreeMile Islandnuclear power plantto restart the reactor under a 20-year agreement to supply its data centers in four states with energy.

Meanwhile, the owners of what was once Pennsylvania’sbiggest coal-fired power plantsay they will turn it into a$10 billionnatural gas-powered data center campus.