Google has entered a 20-year power purchase agreement with Constellation Energy to fund reactor "uprates" across its US nuclear fleet.

Responding to the news, Zoe Stollard, Partner in energy and infrastructure at UK and Ireland law firm Browne Jacobson, commented:

“The UK’s data centre developers in the UK will be watching the deal closely to replicate it. The UK has everything it needs to create the Google-Constellation model, as long as developers, operators and government push for it.

“Google’s deal will get more out of existing reactors, using a long-term contract to give Constellation the financial certainty it needs to upgrade equipment across eleven existing plants – and without building a new one.

“We've seen this model work in the UK: EDF has been squeezing more output out of its AGR stations for years, 263 TWh more than originally anticipated since 2009. EDF has also said Sizewell B could keep running until 2055, but getting the right commercial deal in place is the sticking point. A long-term supply contract with a big corporate customer is one way to overcome this barrier. That is the gap a hyperscaler anchor-customer PPA, of the kind Google has just signed, is designed to fill.

"With Rolls-Royce's SMR programme and Sizewell C's Final Investment Decision already reshaping the UK's new-build pipeline, uprating existing capacity is faster to deliver and sits on sites that are already licensed, connected to the grid and embedded in their communities. For data centre operators facing multi-year connection queues, a credible uprate-backed PPA could, in principle, bring new capacity online years before a new SMR fleet or large-scale reactor reaches commercial operation.

"The practical question for the UK is whether the regulatory and commercial frameworks exist to replicate this model here. Funding uprates through a bespoke, bilateral PPA with a single corporate anchor customer sits outside how EDF's existing fleet investment has traditionally been financed, and it raises genuine questions around security of supply, allocation of uprate and outage risk, and how a data centre operator's capacity rights would interact with wider grid obligations. Developers who want first-mover advantage in this space should be thinking now about how an uprate-PPA structure would need to be adapted for the UK regulatory and contracting environment, rather than waiting for a domestic precedent to emerge.

"Ultimately, none of this happens by without a concerted and collaborative effort. The US deal came together because Google pushed for it, structuring and underwriting a model. If the UK wants hyperscaler capital funding uprates across our own fleet, it will take developers, operators and government pushing for the commercial and regulatory framework to catch up.”