FERC denies Talen-Amazon agreement—again
The Federal Energy Regulatory Commission has doubled down on its rejection of an interconnection service agreement (ISA) between Amazon Web Services and Talen Energy in Pennsylvania.
Last November, FERC denied plans for Talen to supply additional on-site power to an Amazon data center campus neighboring its Susquehanna nuclear plant. The regional PJM Interconnection operator filed for an amended ISA on behalf of the companies to expand power sales from 300 MW to 480 MW in a direct connection to the Amazon facilities. Opponents argued that the deal could threaten grid reliability and raise customer rates.
In its 2–1 initial ruling on April 10, FERC said the parties did not make a strong enough case to prove why a special contract allowing for expanded “behind-the-meter” power sales should be allowed in this instance. Two of the five commissioners did not participate in the vote.
Those voting to deny the ISA this time around listed many of the same reasons, concluding that “the burden is on PJM to show that nonconforming provisions are necessary, and PJM failed to carry that burden.”
Now what? In an appeal filed in January with the Fifth Circuit Court of Appeals, Talen asked for an outside review of FERC's decision. Energy companies including Vistra, American Electric Power Service, Exelon, and PPL Electric Utilities are named as intervenors in the appeal, which gives the companies an avenue to participate in the litigation in the future.
The court, if it takes up the request, could overturn FERC’s decision, uphold the decision, or send the issue back to regulators for further review, Reuters reported.
Talen spokesperson Taryne Williams told Reuters the company was not surprised by the decision and plans to continue with its appeal.
Background: In March 2024, Talen announced its $650 million sale of a 960-MW data center campus to cloud service provider AWS, a subsidiary of Amazon, for $650 million. The data center sits on a 1,200-acre campus and is directly powered by the adjacent Susquehanna plant, which generates 2.5 GW of power.
Talen agreed to supply fixed-price nuclear power to AWS, ramping up minimum contractual power commitments in 120-MW increments over several years.
Numerous other big tech companies are pursuing similar deals with energy companies in hopes of co-locating data centers where they can get reliable, carbon-free power.
Editor's note: A previous version of this story incorrectly identified Vistra, American Electric Power Service, Exelon, and PPL Electric Utilities as cosigners in a joint lawsuit rather than intervenors in an appeal. Nuclear News regrets this error.
