Amazon to fund 960MW of untested small reactors at a dead Indiana coal plant

Amazon, American Electric Power and X-energy said Monday they are exploring a 960-megawatt small modular reactor plant on the site of AEP's former Breed Generating Station in Sullivan County, Indiana, a coal plant that has already been demolished. The design calls for 12 of X-energy's Xe-100 reactors, each rated at 80 megawatts, feeding both Amazon's data centers and the public grid that AEP's Indiana Michigan Power subsidiary operates. None of the companies has committed to actually building it, and no construction timeline was given.

The location is not incidental. Sullivan County is enrolled in Indiana's Advanced Nuclear Ready Communities Program, a state effort to pre-clear sites for reactor development, and AEP has been telling regulators for more than a year that its service territory is facing an unprecedented load surge. Indiana Michigan Power now projects the state's peak demand climbing from roughly 2,800 megawatts to more than 7,000 megawatts by 2030, driven almost entirely by data centers. A February 2025 Indiana regulatory settlement on large-load interconnection rules already counted Amazon, Google and Microsoft among its signatories.

Amazon takes the risk so ratepayers don't have to

The deal's financial architecture is the real story. Amazon would sign a long-term contract to buy the plant's output if it's built, with that contract structured to cover the facility's full construction and operating costs for the life of the arrangement. AEP CEO Bill Fehrman described the agreement as including 'all necessary capital protections and financial safeguards' that he said are a precondition for AEP to even consider a nuclear build. In practice, that means Amazon — not AEP's residential and commercial customers — absorbs the risk if a first-of-its-kind reactor fleet runs late or over budget, a structure that mirrors how Google has approached its own nuclear-adjacent deals with Constellation and Georgia Power this year.

Bill Fehrman, CEO of American Electric Power: "[The agreements provide] all necessary capital protections and financial safeguards" that AEP considers essential for a nuclear project to proceed.

That design choice reflects the politics as much as the economics. Utilities across the country are under pressure from state regulators and attorneys general over data centers pushing up electricity bills for everyone else, and a cost-protected, hyperscaler-funded structure is becoming the default answer. Amazon's VP of data center infrastructure capacity delivery, Josh Weissman, framed it in those terms directly, saying Amazon intends to cover its full costs rather than pass them on to other customers, while also touting the project's construction jobs and decades of state tax revenue.

The reactor fleet behind the deal hasn't built anything yet

What's being financed, however, is still speculative. X-energy has not broken ground on a single commercial reactor anywhere. Its first planned plant, at Dow Chemical's Seadrift site in Texas, is still working through the final phase of its NRC construction permit review and is separately the target of a Texas state lawsuit alleging 'habitual non-compliance' with water and solid-waste permitting at the site. Indiana's reactors would depend on that Texas project succeeding first, since it is meant to prove out the Xe-100 design and X-energy's TRISO fuel supply chain before any second site follows.

Investors have been pricing in that uncertainty. X-energy went public in April at $23 a share and popped 27% on its first trading day, but the stock had fallen by roughly two-thirds by this week, before rising about 10% in premarket trading on the Indiana news. The broader bet behind small modular reactors — that shrinking reactor size enables factory-style mass production that eventually drives costs down — is one that nuclear-industry analysts generally say takes close to a decade to pay off, if it pays off at all, given the cost overruns and delays that have plagued large-scale U.S. nuclear construction for the past two decades.

The Indiana project is Amazon's second commercial agreement with X-energy, after a roughly 320-megawatt (expandable to 960-megawatt) project with Washington state utility Energy Northwest announced in 2024, and the companies describe it as about three times the scale of that first deal. Amazon has said it wants to help develop more than 5 gigawatts of new U.S. nuclear capacity by 2039. Taken together with Google's recent nuclear uprate and PPA deals and the continuing fights over PJM's grid capacity, Monday's announcement is less a one-off than a signal that hyperscalers are now willing to underwrite first-of-a-kind reactor risk directly, years before any of these designs have proven they can be built on time or on budget.