Constellation wins landmark 10-year government electricity contract

The energy procurement is the largest in GSA history, according to the agency’s January 2 news release, and will provide more than 10 million megawatt-hours during the 10-year agreement. The purchased energy will power 80 federal facilities in the PJM Interconnection service territory, which includes 11 mid-Atlantic and Midwest states and Washington, D.C. The deal also will enable the agencies covered to achieve 100 percent clean electricity by 2030.

To support the contract, Constellation says it will extend the licenses of its existing nuclear plants and invest in new equipment and technology to increase output by approximately 135 MW.

Quotable: “For many decades, Constellation’s nuclear fleet has provided carbon-free, reliable, American-made energy to millions of families and institutions,” said Joe Dominguez, Constellation’s president and chief executive. “Frustratingly, however, nuclear energy was excluded from many corporate and government sustainable energy procurements. Not anymore. This agreement is another powerful example of how things have changed.”

GSA administrator Robin Carnahan said in the agency’s news release that the deal ensures reliable energy and protects taxpayers against future price hikes. “We’re demonstrating how the federal government can join major corporate clean energy buyers in spurring new nuclear energy capacity and ensuring a reliable, affordable supply of clean energy for everyone.”

Background: The GSA is an independent government agency that provides centralized procurement for the federal government “to deliver the best customer experience and value in real estate, acquisition, and technology services to the government and the American people,” as explained on its website.

The agency’s cost-minimizing role is especially important as the nation faces uncertainty about future energy costs while dealing with soaring electricity demand from artificial intelligence and data centers. With more than 300,000 buildings and 600,000 vehicles, the federal government is the nation’s largest energy consumer, according to the GSA.

With 21 reactors, Constellation operates the country’s largest fleet of nuclear power plants. The company announced last September plans to restart Three Mile Island Unit 1—as the Crane Clean Energy Center—in Pennsylvania.

The reactor was shut down on September 20, 2019, following 45 years of electricity generation. It was relicensed for operation until 2034, but Constellation (then Exelon Generation) prematurely shuttered it due to unfavorable economic conditions as prices for natural gas hit historic lows and government subsidies for clean energy did not extend to nuclear.

A closer look: The deal to supply energy to the GSA and 13 additional entities includes the Washington Metropolitan Area Transit Authority, the Department of Veterans Affairs, the Architect of the Capitol, the Department of Transportation, the Federal Bureau of Prisons, the Federal Reserve Board of Governors, the National Archives and Records Administration, the National Oceanic and Atmospheric Administration, the National Park Service, the Social Security Administration, the Army Corps of Engineers, the U.S. Mint, and the Railroad Retirement Board.

The contract is set to begin in April 2025.

The Clean Energy Buyers Association applauded the announcement, and CEO Rich Powell said, “Utilizing the buying power of more than a dozen agencies of the U.S. federal government to advance low-cost, reliable, carbon emissions–free energy sources like nuclear is a powerful signal to the broader market to drive new generation investment and new infrastructure to support it.”

“It’s not just industry that is recognizing the importance of clean, reliable and affordable nuclear energy,” said Jeremy Harrell, CEO of ClearPath, a nonprofit supporting policy solutions for clean energy. “The federal government’s commitment to use nuclear energy . . . demonstrates how the public and private sectors can work together. As U.S. electricity demand grows, this partnership can serve as a model to accelerate power uprates at existing nuclear sites and the construction of new nuclear reactors.”

Added energy savings: The GSA also awarded Constellation a $172 million contract to deploy conservation measures at five GSA-owned facilities in the Washington, D.C., area. The work will include LED lighting; weatherization; window inserts and replacements; and new and upgraded HVAC and building control equipment to improve energy efficiency, decrease emissions, and save on energy costs at five buildings.

The buildings located in the capital will be converted from steam power to power from electric boilers and heat pumps to meet the buildings’ heating requirements and produce some of the most significant energy conservation measures of the project, Constellation said.

Construction is scheduled to begin this month and continue for approximately 42 months. Constellation will provide preventive maintenance services and ongoing training to help GSA personnel maximize energy efficiency and cost-savings efforts.

Broad effort: President Biden created the Federal Sustainability Plan through an executive order, setting a range of ambitious goals, including reaching net-zero emissions for federal operations by 2050 through a transition to zero-emission vehicles, energy efficient buildings, and CFE.

The federal government aims to transition to complete CFE by 2030, with at least half being locally supplied to meet 24/7 hourly-matched demand, GSA’s news release said. During the past three years, the administration has developed a clean energy procurement pipeline by partnering with energy suppliers across 36 states to move the federal government from its current 40 percent clean and carbon-free electricity match to 70 percent by 2027, and ultimately 100 percent by 2030.