Could nuclear energy be key to Texas data center boom?
Driven by economic growth, data centers and an increasingly urban population, industry leaders in Texas foresee energy demand increasing exponentially over the next decade.
“We've had this relatively flat growth for the last two decades,” said Tony Robinson, president and CEO of nuclear power company Framatome. “That's changed, and I think we're using the wrong term. I don't think it's a surge in demand. I think it's a tsunami.”
Robinson cited the amount of power needed by data centers, for cloud computing and crypto mining, the state’s growing population along with all the electronic devices used by consumers as major contributions to this increase in energy needs.
“The amount needed on a daily basis is astronomical,” he said.
Robinson was one of several speakers at the Texas Christian University’s Ralph Lowe Energy Institute’s Global Energy Symposium on April 15, an annual event that looks at the state of the industry.
A year ago, the Electric Reliability Council of Texas, the nonprofit corporation that operates the state’s power grid, said the current power demand record for use in Texas was 85.5 gigawatts, set in August 2023. The organization now expects an estimated peak demand of 218 gigawatts by 2031.
One single type of energy source is not going to provide the kind of power needed in the state or the nation, Robinson said. The state will need wind, solar, natural gas, geothermal and other forms of energy, he said.
“It's not going to be just oil and gas, it's not going to be just nuclear,” he said. “We need all of the above.”
Nuclear power can produce clean, fast and renewable energy, but can be hampered by public perception, said Brian Gitt, senior vice president of business development for Oklo Inc., a firm that designs fission reactors.
Gitt compared a reactor to “a big tea kettle” that boils water to produce energy.
Opponents said nuclear projects have significant issues to consider, including a lengthy approval process.
“High up-front costs and first-of-a-kind deployment make advanced nuclear designs economically risky,” officials with environmental group CleanWisconsin said in a statement. “Although the Trump administration recently announced an $80 billion-plus commitment to help fund new reactors, there are plenty of reasons to be skeptical that these projects will materialize.”
Investment in the nation’s power grid and related infrastructure is increasing along with the power needs of businesses and consumers, said Ken Peters, senior vice president of energy provider Vistra.
“I don't believe this is a cyclical phenomenon. I believe it’s structural,” he said, noting that utilities are expected to spend as much as $1.4 trillion on the grid and infrastructure over the next five years. “Think about that number. That’s more zeros than I can add up.”
Such power needs have forced energy providers and businesses to get creative, Peters said.
He noted Amazon’s plans at Vistra’s Comanche Peak nuclear plant near Glen Rose.
Amazon plans to locate a data center on Comanche Peak property, using power from the plant. The project would be a win for both the company and the community, Peters said.
“They will get power and bring their own backup generation,” he said. “So if the grid is stressed and needs the full output of Comanche Peak, we will kick them off of our output, and they will use their backup generation.”
Another project looking to the future of power in the state is taking place 150 miles west of Fort Worth, in Abilene, where a partnership between Natura Resources, Abilene Christian University and others is heading up a $240 million project to build the first liquid-fueled molten salt nuclear reactor since the 1960s. It is not a large reactor like those at Comanche Peak, which can produce about 2,400 megawatts of power. The Natura Resources molten salt reactor is smaller and more modular and produces about 300 megawatts. Such reactors have not been commercially built.
Justin Sink of Natura Resources speaks at the TCU Global Energy Symposium on April 15 at Texas Christian University. Tom Seng, assistant professor of professional practice at TCU, seated, moderated the panel. (Bob Francis | Fort Worth Report) The nuclear power industry had not been actively building many new plants for years, following the Three Mile Island accident in 1979, according to Robinson. As a result, nuclear energy fell out of favor with both the public and the investment community, said Vistra’s Peters.
Most of the plants had been large scale projects requiring massive investments, he said. These new plants will require much less investment, he said.
One reason Natura is partnering with a university is to help develop the industry expertise needed to deploy more systems like theirs, said Justin Sink, vice president of strategic initiatives at Natura Resources.
The people who built reactors like this in the ’50s and ’60s are no longer part of the work force, he said.
“You've got to learn how to build a thing, how to operate it, how to go through the full life cycle, and we're working on doing that as rapidly as possible to move to commercial uses,” said Sink.
Ron Gusek, CEO of Liberty Energy, a Denver-based oilfield services company, said communities are shedding their “not in my backyard” mentality as more warm up to industrial power generation.
Gusek said his company has operations throughout the Denver metropolitan area since it is atop the oil- and natural gas-rich Denver-Julesburg Basin, also known as the D-J Basin.
“That resource sits underneath the Denver metro area and so we find ourselves working 500 feet from people’s backyards,” Gusek said. “We’ve had to navigate this intersection between people’s lives and a 24-hour industrial operation that might be present for a month or two. We’ve gotten very good at community engagement.”
Other options are being developed. In partnership with Texas Tech University and the Texas Produced Water Consortium, Natura Resources is looking to integrate molten salt reactor technology with water desalination systems, aiming to convert “produced” water from oil and gas operations into usable water for other industries — although it is too toxic to drink.
The reactor will also produce medical grade isotopes that are used to diagnose and treat diseases, particularly cancer.
Power generation is not the only area in which the state is looking to find more energy.
The Public Utility Commission of Texas and Electric Reliability Council of Texas last April approved the state’s first 765-kilovolt transmission lines, a $33 million project to address severe congestion and soaring power demand in the Permian Basin. The state previously used 345-kilovolt lines. The more efficient 765-kilovolt lines can replace about five 345-kilovolt lines, reducing the amount of land needed for power lines, said Pablo Vegas, president and CEO of the Electric Reliability Council of Texas.
That could change the way public utilities use right-of-way, Vegas said.
“It uses a fraction of the land requirements,” he said. “If you think about the need to carry five times as much as a 345 (line), you can translate that directly to right of way usage. You need much less land, much less condemnation.” Condemnation is the legal process where a government entity exercises its power of eminent domain.
Gitt said more communities are interested in energy production because they want the jobs associated with those operations.
“They need economic development,” he said. “They need that tax base for their schools, for their emergency services, for all the city services that are provided.”
Listening to people’s concerns about nuclear safety are paramount in establishing relationships that could lead to industrial projects, Gitt said.
“We’re going to turn NIMBY — not in my backyard — to nuclear in my backyard, meaning bring it here,” Gitt said. “That’s the direction of travel. Those communities that don’t want to do this are going to be left behind economically.
“This is all about economic development.”
Bob Francis is business editor at the Fort Worth Report. Contact him at bob.francis@fortworthreport.org.
Eric E. Garcia is senior business reporter at the Fort Worth Report. Contact him at eric.garcia@fortworthreport.org.
Disclosure: Fort Worth Report is a media sponsor of TCU’s Ralph Lowe Energy Institute’s Global Energy Symposium. At the Fort Worth Report, news decisions are made independently of our board members and financial supporters. Read more about our editorial independence policy here.
This article first appeared on Fort Worth Report and is republished here under a Creative Commons Attribution-NoDerivatives 4.0 International License.
