The headline: Google and Constellation Energy will bring 890 megawatts of new nuclear capacity onto the PJM grid.
The contract: Google signed for 3,590 megawatts. The other 2,700 come with no new plant attached.
Google and Constellation Energy announced on Tuesday a two-part power deal that sent Constellation’s stock up about 13% on the day. The coverage has mostly treated the whole package as nuclear supply for an AI grid, and a few analysts have noted that the larger half is not nuclear at all. What nobody has done is measure the deal against the yardstick Constellation itself invoked. Its announcement calls the agreement “a direct response” to PJM’s bring-your-own-power proposal, and that proposal has a list of what counts as new capacity. Uprates are on it. Output from plants that are already running is not. Run the deal through that list and 890 of the 3,590 megawatts qualify, about a quarter, which is roughly 13% of the gap PJM’s last capacity auction left open.
What Google Actually Signed
There are two contracts. The first is a 20-year power purchase agreement that funds uprates at 11 Constellation nuclear units in Illinois, Pennsylvania and New Jersey, replacing turbines, steam generators and digital controls so reactors that already exist produce more. Constellation puts its investment at more than $4.3 billion and says the first upgraded plant should deliver power in 2028. The second is a 15-year supply agreement for 2,700 megawatts from Constellation’s PJM fleet. Neither company disclosed a price, and Google’s own release does not either.
The Shortfall It Is Measured Against
PJM ran its 2028/2029 capacity auction in July. The auction report shows total procured capacity landing 6,831.3 megawatts short of the reliability requirement, the second straight auction more than a point below the target reserve margin. Every zone cleared at the $325 per megawatt-day cap. Without the cap, PJM’s own simulation put the price near $554.72, and $776.69 in the ComEd zone that covers northern Illinois, home to the deal’s Illinois units.
Our Arithmetic
890 divided by 6,831 is 13%. That is a real dent. It is also about 4.3 times the 207.6 megawatts of uprates that cleared in the whole July auction, which says something about how much this one contract changes the supply picture for a single category.
The Caveat a Fair Reading Needs
PJM counts capacity in unforced megawatts, a derated figure, while deal announcements quote nameplate. Nuclear units run so reliably that the haircut is small, so the 13% holds up roughly, but it is an estimate rather than a match. Timing cuts the other way: the first uprate is due in 2028, and the full 890 megawatts arrives in stages after that.
What Counts Under PJM’s New Rule
PJM filed its large-load framework with federal regulators in August and asked for an effective date of October 12, five days from now. Data centers of 50 megawatts or more coming online after June 1, 2027 can avoid early curtailment by bringing their own new capacity: new generation, certain uprates, storage, repowering and a few others. A long-term contract on existing output is not on the list. Under the rule Constellation says this deal answers, the 2,700 megawatts would not count toward protecting a new Google data center from early curtailment.
Where We Land
Google deserves credit for the uprates. They are the fastest firm capacity anyone can add in PJM, they avoid the interconnection queue, and Google is paying to build them rather than simply claiming output households already rely on. That is the model. The 2,700 megawatts is something else: a hedge that locks in supply for Google while everyone else pays a capped price for a grid that is short. It should not be marketed as part of the answer to the shortage. FERC should approve PJM’s qualifying list as filed, and every hyperscaler deal should disclose how much of the headline number is new.
The First-Day Report
Reader Questions
What is a nuclear uprate?
An uprate raises the licensed output of a reactor that is already operating, usually by replacing turbines, steam generators and controls. It needs federal approval but skips the years of siting and grid-connection work a new plant faces.
Does the 2,700-megawatt supply agreement add power to the grid?
Not as announced. Neither company tied it to any new plant, so it commits existing supply to Google for 15 years rather than adding megawatts.
Is this the only deal like it?
No, and the ratio repeats. Amazon’s 20-year Calvert Cliffs agreement on September 30 covers 690 megawatts, of which about 190 are new uprate capacity due between 2030 and 2032.
What to Watch
FERC’s order on PJM’s filing.
The price, if it ever surfaces.
And the next auction, where 890 megawatts either shows up or does not.