Amazon announced on Wednesday, 16 October it had signed three new agreements to support the development of nuclear energy projects to power its data centres in the US. 

The technology giant is buying a stake in nuclear developer X-energy, anchoring a $500 million fundraising that also involves Citadel and the University of Michigan, and collaborating with utility companies Energy Northwest and Dominion Energy to develop projects in Washington and Virginia respectively. 

The agreements will give Amazon the right to purchase a set amount of electricity once the projects become productive, which the company will use to power its data centres used for its energy-heavy AI operations. 

Amazon pledged to match all its electricity consumption with renewable energy by 2030, a goal which they achieved last year largely through wind and solar energy investments. It is the largest corporate purchaser of renewable energy.

Now, increased energy demands from the company’s AI investments mean it must look elsewhere for reliable, large-scale, emissions-free sources of energy.

“One of the fastest ways to address climate change is by transitioning our society to carbon-free energy sources, and nuclear energy is both carbon-free and able to scale—which is why it’s an important area of investment for Amazon,” said Matt Garman, CEO of Amazon Web Services.  

The company is focussed on funding projects using small-modular reactors (SMRs), an advanced kind of reactor that is far smaller than traditional reactors, and can be built faster as a result. 

While no SMRs have been built in the US yet, companies and governments are considering them more for the benefits to modularity, and the capability to be built in a factory (instead of on-site, as large reactors are), which could increase efficiency and reduce cost. 

Google and Microsoft, other tech giants, have also turned to nuclear power in response to increased demand for AI technology without compromising their climate commitments. 

Microsoft has partnered with Constellation Energy, a carbon-free energy company, to reopen the Three Mile Island nuclear plant in Pennsylvania, while Google has announced it will purchase nuclear energy from another SMR startup, Kairos Power, in 2030. 

Both companies recently pioneered AI chatbots Copilot and Gemini respectively and announced investments of tens of billions of dollars in AI technology and are looking to expand their long-term capacity for AI growth without compromising their climate goals. 

Data centres, used to store anything from consumer information to network and computing power, have always needed high amounts of electricity to run and operate their cooling systems. A data centre with advanced AI computing chips will need 10 to 20 times more power than that: far exceeding the capacity of power grids in the rural areas that usually house data centres. SMRs are small and efficient enough that they could be placed next to the data centre they are powering, making energy easier to transport and thereby requiring less power.

This development comes at a time when AI’s resource usage has come under heavy fire: a report found that ChatGPT uses four times more water than previously thought; each one-hundred-word email produced by the chatbot consumes the equivalent of a bottle of water. This has led many environmental activists to oppose Amazon’s latest development. 

On the other hand, nuclear power is widely defended as being a safe and emissions-free alternative to fossil fuels, providing the reliable and large-scale production that wind and solar facilities often lack.