As companies including Microsoft, Amazon, and Google rapidly expand their global data center capabilities, they are actively seeking new electricity sources.

Amazon has signed three agreements to support the development of Small Modular Reactors (SMRs), which are more compact and potentially easier to deploy than traditional reactors.

The technology is still in its infancy and lacks regulatory approval, however, raising doubts about implementation timelines.

"One of the fastest ways to address climate change is by transitioning our society to carbon-free energy sources, and nuclear energy is both carbon-free and able to scale -- which is why it's an important area of investment for Amazon," said Matt Garman, CEO of Amazon Web Services.

Amazon's new partnerships include collaborating with Energy Northwest to develop four advanced SMRs in Washington state, potentially generating up to 960 megawatts of power by the early 2030s.

The company is also investing $500 million in X-energy, a leading SMR developer, to support more than five gigawatts of new nuclear-energy projects.

Additionally, Amazon is teaming up with Dominion Energy to explore an SMR project near Virginia's North Anna nuclear power station, aiming to add at least 300 MW of power to meet projected demand increases.

Northern Virginia, a global internet crossroads, is experiencing unprecedented growth in electricity demand due to data center expansion. Dominion Energy has indicated that new natural gas plants may be needed despite commitments to decarbonize the state's power grid by 2045.

But the need for fossil-fuel-fired generation to power data center growth is at odds with the environmental ambitions of major tech companies, which are championing their ability to deliver AI's power without tarnishing their green credentials.

Google recently signed a deal with Kairos Power for SMR-generated electricity, while Microsoft plans to use power from the restarted Three Mile Island facility.

Amazon has also announced plans to locate a major data center next to a 40-year-old nuclear facility in Pennsylvania.

According to Goldman Sachs, data center power demand is estimated to grow 160 percent by 2030, with AI representing about 19 percent of data center power demand by 2028.

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