Key Highlights

● Amazon signed for 690 megawatts on Sept. 30.

● Google signed for 3,590 megawatts on Oct. 6.

● Constellation will invest more than $4.3 billion in uprates.

● Constellation closed at $300.40 on Tuesday.

The first came on Sept. 30, when Amazon (NASDAQ:AMZN) signed a 20-year agreement with Constellation Energy (NASDAQ:CEG) for 690 megawatts of power. The second, announced on Tuesday, Oct. 6, was far larger: Alphabet (NASDAQ:GOOGL)'s Google agreed to a 20-year power purchase agreement covering 3,590 megawatts in total.

The Google deal has two parts. About 2,700 megawatts will come from Constellation's existing nuclear plants under a 15-year Supply portion of the agreement. The remaining 890 megawatts will be new capacity, created through uprates, engineering upgrades that boost the output of existing reactors, at 11 reactors in Illinois, Pennsylvania and New Jersey. Constellation will invest more than $4.3 billion, and the first uprates are due by 2028. The work would create about 7,200 construction jobs.

Taken together, the two agreements cover well over 4,000 megawatts of nuclear output committed to two cloud giants within a single week.

Why tech wants nuclear

The appeal comes down to the needs of AI data centers. They consume vast amounts of electricity and run around the clock, which makes intermittent sources such as solar and wind harder to rely on without backup. Nuclear plants generate steady power day and night without carbon emissions, matching both the operational and climate goals that large technology companies have set for themselves.

Long contracts also give both sides certainty. Technology companies secure supply for decades in a market where new capacity is scarce, and the power producer gains a predictable Revenue stream that can justify investing billions in upgrades.

Constellation chief executive Joe Dominguez presented the Google deal as a template: "This long-term clean energy collaboration with Google can serve as a model for how technology companies and the energy industry can work together to responsibly develop the digital economy."

How markets reacted

Investors cheered the seller more than the buyers. Constellation shares rocketed on Tuesday, closing at $300.40 after reaching as high as $309.30 during the session. Alphabet shares were little changed. Amazon edged higher.

The excitement spread across the power industry. Vistra (NYSE:VST), Talen Energy (NASDAQ:TLN) and NRG Energy (NYSE:NRG) climbed sharply, small reactor developers such as Oklo (NYSE:OKLO) and NuScale Power (NYSE:SMR) surged, and utilities were the best-performing sector in the S&P 500. The index itself rose 44.98 points to a record 7,818.93.

The bigger picture

AI's energy needs are increasingly showing up in economic data and policy debates. Tuesday's trade report showed record imports of capital goods, led by semiconductors and AI equipment, and San Francisco Fed President Mary Daly named AI-related Demand for chips as one of three sources of Inflation pressure. Electricity is increasingly discussed as a constraint alongside chips, and deals like these are one way technology companies are trying to secure it.

Copycat Contracts and Uprate Progress Decide What Follows

Investors will watch for whether other technology companies, such as Microsoft (NASDAQ:MSFT) or Meta Platforms, strike similar long-term agreements, and whether rival generators like Vistra and Talen land deals of their own. Progress on Constellation's uprate projects and any regulatory approvals will also matter. On the macro side, the Federal Reserve's September meeting minutes arrive on Oct. 7 and September consumer price data on Oct. 14, with interest rates a key Factor for capital-intensive power projects.