NextEra secures $1.9bn DOE loan to restart Iowa nuclear plant
NextEra Energy has received a $1.9 billion loan from the US Department of Energy to refurbish and restart the Duane Arnold Energy Center in Iowa. Google announced plans in October to revive the plant, which has been offline since 2020, and is reportedly considering building as many as six data centres nearby.
The facility is expected to return to service in 2029. During the refurbishment, NextEra plans to add 14 megawatts, taking Duane Arnold’s total capacity to 615MW. Deputy Secretary of Energy James Danly said the restart would drive down electricity costs, without explaining the mechanism.
A second federal loan for a nuclear restart
The Duane Arnold financing is the second Department of Energy loan directed at restarting a retired nuclear facility. Last year, the department extended a $1 billion loan to Constellation Energy for the planned restart of a reactor at Three Mile Island.
That reactor last operated in 2019 and is scheduled to restart in 2028 with 835MW of generation. Microsoft signed a deal with Constellation two years ago in connection with the Three Mile Island project. The two projects indicate a growing role for previously shuttered nuclear assets in plans to supply large technology loads.
Data-centre demand changes the economics
Duane Arnold was mothballed after an intense rainstorm damaged the plant in 2020. NextEra chose not to repair it at the time, when inexpensive natural gas had made nuclear generation less economically attractive. Conditions have shifted as AI growth and wider electrification increase demand after decades of limited load growth.
New data centres are expected to nearly triple the sector’s electricity demand by 2035. This has made existing, closed nuclear sites attractive because they can provide clean, firm power more quickly than entirely new generating projects. The context also includes Google's geothermal energy deal for Utah data centres, which shows Google pursuing several power sources for data-centre operations.
Capacity allocation remains material
Not all of Duane Arnold’s output will be available for new technology demand. NextEra chief executive John Ketchum said last year that 50MW would be reserved for the local power cooperative. That allocation would cover 18% of Iowa’s demand growth since 2021, the year before ChatGPT was released.
Other arrangements illustrate different approaches to matching technology demand with nuclear output. Meta is buying all clean-energy attributes from Constellation’s 1.1GW Clinton Clean Energy Center in Illinois, while the plant’s electricity continues to flow to the local grid. For businesses planning major computing capacity, the implication is to distinguish a plant’s headline megawatt capacity from contracted output, local allocations and the timetable for returning generation to service.