AEP, Amazon and X-energy explore a 960-megawatt nuclear plant at a former Indiana coal site

American Electric Power and reactor developer X-energy will study whether to build a 960-megawatt nuclear plant on the site of a retired coal plant in Indiana, with Amazon funding the project's development and planning to buy its electricity, the companies said on Monday, Oct. 19.

What the companies agreed to

AEP said it had signed a joint development agreement with X-energy to evaluate the feasibility of building a 960-megawatt advanced nuclear project at a former coal plant site in Sullivan County, Indiana. Amazon is supporting the project's development through a funding agreement. If the plant is built and enters commercial operation, Amazon intends to buy the power under a long-term contract covering the costs of the facility and its operations for the length of the contract, AEP said.

The design calls for 12 of X-energy's Xe-100 reactors of 80 megawatts each, configured in groups of four and added in phases. AEP would own and operate the plant. The site under study is the former Breed Generating Station, a shuttered coal plant of AEP's Indiana Michigan Power utility. The companies did not disclose what Amazon will pay or give a timeline for construction or operation.

AEP Chief Executive Bill Fehrman said the agreements with Amazon and X-energy "will provide all necessary capital protections and financial safeguards that we have said are essential for any potential nuclear project to move forward." That condition matters in Indiana, where The Verge noted the Marble Hill nuclear plant was abandoned half-finished in 1983 after $2.5 billion had already been spent on it.

Why Amazon is paying for it

Amazon said the Indiana plant is the second project in its partnership with X-energy, which aims to add more than 5 gigawatts of new nuclear capacity to the U.S. grid by 2039. The first is the Cascade Advanced Energy Facility in Washington state. Amazon led X-energy's Series C-1 funding round in 2024, which closed at $700 million, to help finish the reactor's design and licensing and the first phase of a fuel plant in Oak Ridge, Tennessee.

"Together, we're looking to develop nearly a gigawatt of carbon-free power for the regional grid and pay our full costs without passing them to others," said Josh Weissman, Amazon's vice president of data center infrastructure capacity delivery. Amazon said the plant would serve both the regional grid and its data centers.

The deal is Amazon's second nuclear announcement in as many weeks, Utility Dive reported. On Sept. 30, Amazon signed a 20-year, 690-megawatt power purchase agreement with Constellation Energy to expand and improve the Calvert Cliffs nuclear plant in Maryland. Meta, Microsoft and Google are also exploring nuclear projects to power data centers for artificial intelligence.

Demand in the region is rising quickly. Indiana Michigan Power expects its peak load in Indiana to climb to more than 7,000 megawatts by 2030 from 2,800 megawatts, driven by large new customers, according to a state regulators' decision cited by Utility Dive. That increase of more than 4,200 megawatts is over four times the size of the proposed nuclear plant.

What the Xe-100 is

The Xe-100 is an 80-megawatt high-temperature reactor cooled by helium gas. It runs on TRISO fuel, in which uranium is sealed inside layers of heat-resistant ceramic. Amazon said the design is meant to prevent a meltdown without relying on active safety systems or operators, and that plants using it can be cooled by air, water or both, which could allow them to be built in places with little water. The reactor design is still going through development and licensing.

AEP is not new to nuclear power. Indiana Michigan Power has run the Cook Nuclear Plant in Bridgman, Michigan, since 1975.

What has to happen first

The agreement starts a feasibility study, not construction. AEP and X-energy, with Amazon's support, will work through a series of milestones aimed at a final investment decision if the project proves feasible, according to Indiana Michigan Power's project page. Those include Nuclear Regulatory Commission licensing, approvals to connect to the grid through the regional operator PJM, securing property rights, engaging with the community and deciding how to finance the plant. The utility called these "multi-year processes."

Some groundwork has begun. In September, AEP and Indiana Michigan Power representatives started early field work and environmental surveys around the site. The utility says planned drilling for groundwater monitoring wells and soil samples will gather information required for an early site permit application with the commission. Sullivan County is part of Indiana's Advanced Nuclear Ready Communities Program. Amazon said the plant could create more than 1,000 construction jobs and more than 100 permanent jobs.

How the shares moved

AEP shares were down 1.6% at $125.12 at 1:30 p.m. ET on Monday, compared with Friday's close of $127.14. X-energy shares were up 0.8% at $10.45. They had fallen from $15.45 on Oct. 6 to $10.36 on Friday, near the bottom of their 52-week range of $10.07 to $37.10.