The river beside the Susquehanna nuclear plant used to be quiet at night.
Now, if you stand on the overlook, you don’t just hear turbines humming in the distance—you can almost feel the future being negotiated in the dark: a private deal to siphon electricity straight from the reactor core to the beating heart of the internet.
This is not science fiction. It’s federal policy. And it’s happening faster than anyone expected.
The Deal That Changed the Grid
In December, federal regulators approved a sweeping new order that lets Big Tech plug massive data centers directly into power plants, bypassing much of the traditional electric grid in the name of AI, growth, and “national competitiveness.”[1]
The decision came from the Federal Energy Regulatory Commission (FERC), the obscure but immensely powerful agency that decides how electricity moves across much of the United States.[1]
On paper, this is about “colocation” agreements—arrangements where huge power users like data centers set up shop right next to power plants and draw power directly from them.[1]
In reality, it’s about something bigger:
Who gets priority in a world where there is not enough electricity to go around?
Why This Is Happening Now
AI is devouring energy.
Across the mid-Atlantic—home to 65 million people—demand from hyperscale data centers is growing so fast that grid operators are now warning about looming electricity shortfalls.[1]
Tech companies say they can’t afford to wait years for new transmission lines and bureaucratic approvals. They need power now—to train models, run cloud services, and fuel the AI boom that politicians have framed as a matter of national survival.[1]
FERC Chair Laura Swett put it bluntly: clearing the way for big energy users to tap plants directly is “a critical step” to meet “historic surging demand” and “realize our greatest potential as a country.”[1]
The Trump administration backed the move as part of a broader push to keep the U.S. ahead in AI, even as it pressures states on other fronts to align with federal AI policy.[3][4]
The stakes are not abstract. Power plant stocks jumped after the order. Utilities bristled. Consumer advocates sounded alarms. And in Harrisburg, Pennsylvania, one specific deal became the test case for everyone’s future.
The Amazon–Nuclear Flashpoint
The order traces back to a bitter fight over a proposal involving Amazon Web Services (AWS) and the Susquehanna nuclear plant in Pennsylvania.[1]
AWS wanted to colocate with the plant—essentially planting a data center right next door and pulling huge amounts of power directly from the reactors.
To Big Tech, that’s efficiency.
To utilities, it looked like a backdoor escape from paying to maintain the rest of the grid—the poles, wires, and systems that keep everyone else’s lights on.[1]
Utilities argued that if data centers can bypass them, they lose revenue while still carrying the cost of keeping the grid stable for everyone else.[1]
Consumer advocates went further: if power is diverted from existing plants to private data centers, what happens to prices—and reliability—for ordinary customers?[1]
FERC’s answer was to rewrite the rules.
How the New Rules Actually Work
Behind the legal jargon, the new order does three critical things:[1]
- Creates special regulatory tracks for these plant–data center partnerships, rather than treating them like normal customers.
- Lets big users pay only for the transmission they actually use, which can be far less than what they’d owe through a utility.[1]
- May force colocating users to pay to replace energy they pull away from the wider grid, if they hook into existing plants.[1]
It also orders PJM Interconnection—the massive grid operator for the region—to draft new tariffs and conditions that define exactly how these deals work in practice.[1]
On the surface, this looks like compromise: data centers get their fast lane, and the grid gets some compensation for lost energy.
But the deeper question remains: when the grid is strained, who gets first call on a megawatt—the AI cluster or the family down the street?
One Family, One Bill, One New Reality
Picture this.
In a subdivision outside Baltimore, Jasmine, a nurse and single mother of two, opens her winter electric bill and freezes. It’s the highest she’s ever seen.
Her kids’ school has sent home notes about possible “energy conservation days” to reduce strain on the grid. The local news runs a segment about how “data center growth” is putting pressure on regional electricity supplies.
She scrolls past a headline: “Feds Clear Path for Big Tech to Plug Directly Into Power Plants.” She doesn’t read the story. She just wonders why her utility bill feels like a second rent.
Jasmine will never see the inside of the climate-controlled data center that may now sit beside a gas plant two states away. She’ll never walk past the racks of servers training the models that shape her news feeds, job listings, and medical records.
But she will pay, one way or another—through her bill, through outages, or through public money spent to build new plants and lines to keep up with the AI boom.
Winners, Losers, and the New Energy Politics
Power plant owners applauded FERC’s move; their shares spiked as investors bet on a future where plants don’t just sell into markets, but sign long-term, high-margin deals with tech giants.[1]
Advanced Energy United, a clean-energy trade group, cautiously welcomed the clarity, suggesting it could help renewables set up their own direct deals with big users.[1]
The Edison Electric Institute, representing investor-owned utilities, offered only that it would “continue to work” to protect ratepayers and strengthen the grid—Washington-speak for: we’re not thrilled, but we’re at the table.[1]
Meanwhile, groups focused on consumers and equity worried that this is the start of a two-tiered grid: one optimized for those who can sign billion-dollar contracts, another for everyone else.[1]
What’s Next / Could It Happen Again?
FERC’s order applies first to PJM’s territory—but it is almost certain to become a template for other regions as AI, cloud, and industrial loads keep climbing.[1]
More nuclear plants, gas plants, and even renewable projects may soon host their own colocated data centers. Cities and states will wrestle with whether to court these projects for jobs and tax revenue—or push back over land use, water consumption, and local reliability.
At the same time, federal AI policy is centralizing, with Washington increasingly asserting control over how states regulate AI and how critical digital infrastructure is prioritized.[3][4]
So the question is no longer whether Big Tech will shape the future of energy.
It’s this:
When the next wave of AI-driven demand hits, will we decide—explicitly—who gets power first, or will that choice be made quietly, in contracts signed in rooms the public never sees?
FAQ
Why are big tech data centers connecting directly to power plants?
They want faster, more reliable access to huge amounts of electricity, avoiding long waits and higher costs associated with traditional utility grid connections.[1]
Does this raise electricity prices for regular customers?
Consumer advocates warn it can, if energy is diverted from existing plants and new generation and transmission are built with costs spread to standard ratepayers.[1]
What is a colocation agreement in energy?
It’s a deal where a large power user, like a data center, physically situates next to a power plant and draws electricity directly from it, instead of buying all power through a utility.
How does this affect grid reliability?
If managed well, direct deals can reduce congestion on some lines; if mismanaged, they can strain supply for the broader grid, especially during peak demand.[1]
Are renewable energy projects part of this trend?
Yes. Clean energy companies see the new rules as a way to structure direct-power deals from wind or solar to big users under clearer, standardized terms.[1]
Can states stop these kinds of setups?
States control siting and permitting for plants and data centers, but federal regulators control much of the interstate power market—creating intense tension over who really decides.
Will ordinary households ever benefit directly?
Potentially, if new investment strengthens the grid overall. But without strict protections, the primary benefits may flow to power plant owners and large technology firms.