US Offers Constellation $5 Billion Financing to Spur Nuclear

(Bloomberg) -- The Trump administration is offering as much as $5 billion in financing to Constellation Energy Corp. to upgrade and modernize the nuclear operator's fleet of reactors in Illinois, Maryland, and Pennsylvania.

The projects backed by the conditional loan commitment are expected to add nearly 1.1 gigawatts of electricity and help strengthen the grid and lower costs, according to the Energy Department. Constellation shares surged on the news.

Energy Secretary Chris Wright plans to announce the funding later Tuesday at an Illinois nuclear plant that will supply power to Alphabet Inc.'s Google.

"The Energy Department is accelerating President Trump's American nuclear renaissance and unlocking the full potential of our nation's nuclear fleet," Wright said in a statement. He said upgrades that increase output from existing nuclear facilities can expand electricity supply while supporting grid reliability and affordability for consumers and businesses.

Technology companies are driving interest in nuclear projects to power artificial intelligence. But new reactors can take a decade or more to permit and build. Upgrading components such as turbines can increase the output from existing plants, and is seen as a faster and cheaper way to deliver carbon-free fission electricity.

Constellation shares gained as much as 5.3%, and were up 2.8% to $259.63 at 11:39 a.m. in New York.

The Energy Department financing is part of President Donald Trump's push to expand nuclear power to meet growing electricity demand from data centers and support domestic manufacturing. The funding follows an executive order that set a goal of adding 5 gigawatts of capacity through upgrades at existing nuclear plants, 96% of which has been achieved, the department said.

Constellation is planning investments at six Illinois plants — Braidwood, Byron, Clinton, Dresden, LaSalle and Quad Cities — as well as Calvert Cliffs in Maryland and Limerick in Pennsylvania to increase output from existing nuclear plants, the Energy Department said. The financing, through the department's Office of Energy Dominance Financing, also includes an option to fund future uprates at other Constellation facilities.