Under the terms of the agreement, Talen will supply direct-connect, carbon-free power to the AWS data centre campus from Susquehanna, the nuclear power plant it owns next to the facility.
AWS plan to develop up to 960 MW data center campus, with minimum contractual power commitments to Talen that ramp up in 120 MW increments over several years.
It will have a one-time option to cap commitments at 480 MW.
Each step-up in capacity commitment has a fixed price for an initial 10-year term, after which it reprices based on a fixed margin above PJM energy and capacity prices.
PJM is a regional transmission organisation that coordinates the movement of wholesale electricity in Pennsylvania and surrounding states.
Talen began building the site in 2021 and completed a 48MW hyperscale facility in January 2023.
Alongside the data centre campus, Talen also built a crypto-mining facility that it is not included in the deal with Amazon.
The nuclear power station is the third largest in the US and can provide 2.5GW of power. It was built in the 1980s by energy company PPL.
It came into Talen’s hands in 2015, after PPL’s competitive power generation business was combined with a competitive power generation business owned by Riverstone Holdings, a private equity firm.
Amazon will spend $650 million on the data centre, which represents a Multiple on Invested Capital of 2.5x for Talen.
This will be broken down into $350 million at the close of the deal and $300 million escrowed, released upon development milestones anticipated in 2024, according to an investor presentation released by Talen.
