02 July 2024
A protest lodged against a precedent-setting interconnection service agreement to co-locate a data centre with a nuclear power plant is a “misguided attempt” to stifle innovation, Talen Energy Corporation said.
Susquehanna (Image: Talen Energy)
Exelon Corporation and American Electric Power (AEP) lodged their protest with the US Federal Energy Regulatory Commission on 24 June, saying that the regulator must either hold a hearing, or, failing that, reject the Interconnection Service Agreement (ISA) between transmission provider PJM Interconnection, Talen subsidiary Susquehanna Nuclear, operator of the Susquehanna nuclear power plant in Pennsylvania, and PPL Electric Utilities Corporation.
Earlier this year, Talen announced the sale of its 960 MW Cumulus data centre campus – which is directly connected to the two-unit Susquehanna plant – to Amazon Web Services (AWS), with a long-term agreement to provide power from Talen’s Susquehanna nuclear power plant.
PJM is the regional transmission organisation that coordinates the movement of wholesale electricity in all or parts of Delaware, Illinois, Indiana, Kentucky, Maryland, Michigan, New Jersey, North Carolina, Ohio, Pennsylvania, Tennessee, Virginia, West Virginia and the District of Columbia. Its request to amend an existing Interconnection Service Agreement to increase from 300 MW to 480 MW the amount of load it is allowed to transfer from Susquehanna as “co-located load” was filed with the Federal Energy Regulatory Commission on 3 June. (Co-located load refers to end-use customer load that is physically connected to the facilities of an existing or planned customer facility at the point of interconnection to the PJM transmission system).
The amendment states that 480 MW of load may be physically transferred to a co-located load’s
transmission facilities without a material impact on the transmission system, and also notes that Susquehanna has proposed modifications to allow it to physically transfer 960 MW of power.
“Too many questions of fact remain unresolved in what is, by the filing’s own admission, an ISA that establishes novel configuration,” Exelon and AEP say in their filing, which they say “raises more questions than it answers” and could potentially have a huge impact on customer rates, as well as raising reliability and planning concerns.
“The co-located load should not be allowed to operate as a free rider, making use of, and receiving the benefits of, a transmission system paid for by transmission ratepayers,” they said. “We have no objection to co-location per se, but such load should pay its fair share of system use and other charges, just like other loads and customers.”
Talen has acknowledged that its Interconnection Service Agreement is precedent-setting but also said that the protest is unfounded.
“The rapid emergence of artificial intelligence and data centres has fundamentally changed the demand for power and leads to an inflection point for the power industry,” the company said. “Talen’s co-location arrangement with AWS brings one solution to this new demand, on a timeline that serves the customer quickly. We believe powering the data centre economy will require an all-of-the-above approach, which includes both metered and behind-the-meter solutions.
“Exelon and AEP’s protest of the Susquehanna ISA is a misguided attempt to stifle this innovation by interfering with an ISA amendment agreed to and supported by all impacted parties – which Exelon and AEP decidedly are not.”
Talen goes on to say the facts cited by Exelon AEP are “demonstrably false”, the legal positions are “demonstrably infirm”, and “nearly all the issues raised by Exelon and AEP are not subject to Federal Energy Regulatory Commission oversight, because transmission is not implicated”.
Nuclear power is increasingly being eyed by energy-intensive data centres as a means of meeting their energy demand while achieving zero-carbon objectives, whether through co-location of resources, or energy-matching deals such as last year’s agreement between Constellation and Microsoft to match the energy needs of Microsoft’s data centre in Boydton, Virginia, with Constellation’s carbon-free energy with 35% of the environmental attributes coming from nuclear power. Earlier this year, North American steel manufacturer Nucor Corporation and US tech giants Google and Microsoft Corporation announced plans to work together across the electricity ecosystem to develop new business models and aggregate their demand for advanced clean electricity technologies, including advanced nuclear.
