Growing demand requires growing supply. With more and more data centers and industrial facilities coming online, the United States will likely need 40 GW of incremental peak power generation – requiring hundreds of billions of dollars of related investment – just over the next few years. As large corporate buyers of power seek to meet their climate goals, they are increasingly looking at nuclear power as a scalable and cost-effective option. In this episode, Chad Reed chats with Brandon Oyer, Head of Americas Power and Water at Amazon Web Services (AWS). They discuss Amazon’s recent efforts to contract with existing large-scale and new small modular nuclear reactors, the benefits and risks associated with nuclear power, growing bipartisan support for nuclear development and much more.
Growing demand requires growing supply. With more and more data centers and industrial facilities coming online, the United States will likely need 40 GW of incremental peak power generation – requiring hundreds of billions of dollars of related investment – just over the next few years. As large corporate buyers of power seek to meet their climate goals, they are increasingly looking at nuclear power as a scalable and cost-effective option.
In this episode, Chad Reed chats with Brandon Oyer, Head of Americas Power and Water at Amazon Web Services (AWS). They discuss Amazon’s recent efforts to contract with existing large-scale and new small modular nuclear reactors, the benefits and risks associated with nuclear power, growing bipartisan support for nuclear development and much more.
Links:
Amazon signs agreements for innovative nuclear energy projects to address growing energy demands
7 ways Amazon is thinking big about nuclear energy
Episode recorded November 25, 2024
Chad Reed: I'm Chad Reed.
Hillary Langer: I'm Hillary Langer.
Gil Jenkins: I'm Gil Jenkins.
Guy Van Syckle: I’m Guy Van Syckle.
Chad: This is Climate Positive.
Brandon Oyer: Nuclear power is a bipartisan issue. I think that you just hit on it. Last month, right before a major election, we had a stage full of people from both sides of the aisle that were excited about a nuclear power announcement from Amazon. We all stood together and said this is the right thing to do for the energy sector. This is the right thing to do to drive economic growth. This is the right thing to do to generate power cleanly.
Chad: Growing demand requires growing supply. With more and more data centers and industrial facilities coming online, the United States will likely need 40 GW of incremental peak power generation – requiring hundreds of billions of dollars of related investment – just over the next few years. As large corporate buyers of power seek to meet their climate goals, they are increasingly looking at nuclear power as a scalable and cost-effective option.
In this episode, I chat with Brandon Oyer, Head of Americas Power and Water at Amazon Web Services (AWS). We discuss Amazon’s recent efforts to contract with existing large scale and new small modular nuclear reactors, the benefits and risks associated with nuclear power, growing bipartisan support for nuclear development and much more.
Chad: Brandon, thank you so much for joining us today.
Brandon: Hey, thanks for having me, Chad. Appreciate it.
Chad: Absolutely. Brandon, you started your career in the US Navy's nuclear submarine force, where you supervised nuclear reactor plant operations. Could you tell us what inspired your interest in nuclear power and how you built a career around it?
Brandon: Yes, Chad. Thanks. I guess first, by way of introduction, so Brandon Oyer, so I lead our America's Power, Water and Carbon-Free Procurement here for Amazon Web Services. Yes, my career started out in the military. I went into the Navy to have college funded and got to learn how to operate nuclear power plants underwater. I've served on two different types of submarines, both fast attack and ballistic missile subs. I've spent two years of my life cumulative underwater leading teams to safely power nuclear power plants.
We would submerge, stay submerged for months at a time, start out in Hawaii, do patrols, and eventually moved up here to Washington. What was great is seeing how you can take a large reactor and operate it to generate power, generate propulsion, and do that safely with 120 other, all men when I was in, other 120 other guys on board. We all depended on ourselves and depended on that reactor plant to keep us all alive. It was pretty fun times.
Chad: How did you transition from the military to the corporate world then?
Brandon: Yes, so I did about eight years total active duty in the military. I started out into the energy space working for a private non-regulated utility called Seattle Steam at the time. It supplied thermal energy to about 200 buildings in downtown Seattle, everything from, hotels to the level one trauma care facility here in Seattle, Harborview to a couple of other hospitals. In the military, we learned zero defect, critical infrastructure type mindset. That carried out into my first career there at Seattle Steam.
We were eventually bought out by Brookfield Asset Management and took over leading the portfolio of about, I don't know, eight thermal energy plants all along the West Coast, so Seattle, Portland, LA, Vegas.
Chad: As we jump into our topic today, I want to start with what's really driving many of our cumulative efforts in this space. That is demand growth. In the prior two decades, US power demand barely grew year over year as efficiency improvements largely counterbalanced increased demand from population and economic growth. Over the last couple years, a few years, this has begun to shift. Increasing demand, especially from data centers, industrial facilities is expected to result in the need for potentially 40 gigawatts of incremental peak generation, which equates to a few hundred million dollars worth of related investment just through 2028, I believe. Tell us about Amazon's view on and its role in this increasing US power demand.
Brandon: Chad, you're spot on. It's so great to talk to somebody who understands that for the past roughly two decades that we relied on a lot of efficiency measures, and it was great. If you look further back in history, though, the prior six to seven decades from the '50s on, the energy sector grew at a 9% CAGR for that whole period. Yes, the past 20 years have been relatively flat, but we've experienced significant growth from the electric sector in the past. I just want to get that out there.
Yes, I totally see right now that we've got increasing electricity demand from everything we do in our daily lives, whether it's electric vehicles to online banking and cloud computing and movie streaming to onshoring and manufacturing. There's definitely a convergence of electricity demand increasing. We're going to continue building out the infrastructure that we need. I'm excited about the data center space as they provide the critical backbone for modern technologies from AI solutions to anything else that you might do – shopping., I think I already mentioned banking and watching TV and everything that we do today is just so inherent to what we provide.
At Amazon, we know that we're going to continue growing and we're also going to do that carbon-free. We made our climate pledge goal to be net zero carbon by 2040, and we're going to hit that. We've already hit our 100% renewable goal. We're super proud of that, but we don't rest on our laurels. We're looking forward to new ways to help enable that growth in a carbon-free way. One of the things that we see that we need to add to our portfolio was nuclear. Nuclear is a carbon-free source of energy. It's a firm source of energy, that baseload that the electricity grid really needs. Yes, we're excited to continue on this journey.
Chad: Yes. Amazon really has been the top corporate leader in the US in purchasing renewable energy for the past four or five years. As you noted, you already hit your goal to match all of your electricity consumed by your operations with 100% renewables. You have a net carbon-free goal by 2040. You've invested in over 500 solar and wind projects, nearly 30 gigawatts of nameplate capacity. As you just noted, you have announced your foray into the nuclear space. You've announced a few partnerships with suppliers of nuclear power to support new and existing demand for data centers.
Tell us a little bit, some folks are inherently wary of nuclear power. Tell us why it's clean, why it's carbon-free, and why we perhaps shouldn't be as concerned with environmental risks and costs associated with it.
Brandon: Yes, there's a lot there. I just want to double down on the fact of being proud to lead a team that's been significantly responsible for being the world's largest corporate purchaser of renewable energy for four years in a row. Just because we're looking at other technologies doesn't mean we're going to stop there. In fact, like I'm just reviewing now, our roadmap for next year, how much we're going to go procure, and the numbers are pretty large and we're going to continue to grow that portfolio. I'm excited for that. We see nuclear energy as a scalable, safe, carbon-free source of energy. I'll dive in on that one here in a second. It's a proven technology.
There's new variants of it. At Amazon, we're always innovating. We see the small modular reactor space as a way that we're going to go and innovate next, and we're going to leverage our climate pledge fund to invest in the next generation of nuclear. We're completely comfortable with investing in technology to enable ourselves long-term growth. We think long-term here at Amazon and we're using climate pledge funds to invest in SMRs to do that.
We're also going to continue looking at all other sustainable sources of energy, everything from hydrogen to battery storage to geothermal. We're not going to just take a one-size-fits-all all approach here. We realize that energy is a very backyard sport, if you will. It's regionally dependent, whether you can use carbon capture or whether you have geothermal resources. Yes, we'll continue building on the portfolio. You asked, why do we see nuclear power as clean? I don't think it's just us. I think industry as a whole agrees that nuclear power is a firm baseload carbon-free source of energy.
You're not combusting fossil fuels. Does it have other aspects that need to be taken care of? Sure. From a safety and security perspective, we think small modular reactors really hit that home from passive controls and increased security to the efficiency of how the fuel is utilized are all increased and heightened from prior larger reactors. The Department of Energy, the Nuclear Regulatory Commission, they're still going to be involved to make sure that from a permitting perspective, these reactor plants are safe and that they're proven before they come online and also enable some level of innovation so that we can start to scale up a little bit more than the industry has in the past.
Gil: Climate Positive is produced by HASI, a leading climate investment firm that actively partners with clients to deploy real assets that facilitate the energy transition. To learn more, please visit HASI.com
Chad: Let’s talk about your recent agreement with Talen Energy to potentially contract with the Susquehanna Nuclear Power Plant. I'm actually from Pennsylvania. We have some legacy nuclear facilities there. Could you tell us a little bit more about this agreement and your goals there?
Brandon: Cool. First off, from Pennsylvania, did you spend time in the Poconos as a kid, getting out onto the mountains and enjoying some snow?
Chad: I was from Western Pennsylvania, and it is a different world than Eastern Pennsylvania. I have been to the Poconos more recently than I live in New York. It's definitely a beautiful, perhaps one of the most underrated, beautiful parts of the country for sure.
Brandon: Great. Yes. I've spent some time up there. I think as we look forward to what we're doing here from a climate pledge perspective, I want to make sure that generations behind us get to go and enjoy those fun mountains. Let's get back to Susquehanna. This was our first foray into nuclear power. There's a little bit of innovation going on here. We were piqued by this because we saw how fast we could get to the power to enable the growth of our business, which was exciting. Then also, we saw that ensuring that an existing nuclear facility was operating, and we could ensure that it stayed operating for the long term by a long-term power purchase agreement, ensuring financing was there, was a strong benefit to the electric grid.
We don't need to see another nuclear facility that goes offline because of financial reasons. We think that there's a need to back there, so that's one. This project brings economic benefit for the community, from the construction jobs to the tax revenue and all the other good stuff that is enabled through just the deal there. We think that Talen was our first entrance here. Is it going to be our only way that we're going to go and do deals? No. We've enabled this asset to continue operating and continue generating carbon-free power for the foreseeable future, and that is exciting.
Chad: Yes, absolutely. One thing that we think of here as climate-positive investors is we always look at what is the alternative to the assets in which we invest. And in this case, keeping nuclear facilities online – the alternative is building often new gas peaker plants or even coal plants in some cases, and obviously, both of those have higher carbon emissions than a nuclear facility. It's definitely something I think the whole industry is looking at, is how do we keep our existing nuclear fleet online so that we can meet our climate goals domestically and across the globe?
It's very interesting to see Amazon take an active role in that. I'd love to turn to your work on small modular reactors, SMRs. It's a somewhat newer, more innovative technology. Can you tell us a little bit about how the SMRs differ from traditional nuclear reactors?
Brandon: Yes. I want to just hit on the small part isn't the most important part of the small modular reactor. What we're really looking for in the SMR space is making sure that we're building a technology that is easier to build and scale than traditional, large, on-site-built reactors. SMRs, they're an advanced reactor. They have typically smaller physical footprints, which allow you a little bit more fungibility into where you site them onto the grid, and they are going to be faster to build than traditional. You can scale them.
This is something that we at Amazon we get, like we have to scale things up, whether it's from our electric vehicle fleet for delivering packages or our sortation centers or utilizing robots and AI to sort up packages to using software to scale how we build out the cloud, we see this as a very relatable aspect that's in our DNA. From the scalability, that's one.
Second, when you scale something, you can drive the cost out of it. Continuing to build large-scale reactors is possible to drive out the cost.I'm not saying there's only one way here, but we see the small modular reactors being smaller and allowing you to take up less space and optimize the manufacturing aspect, driving out the cost to build them, which would drive down the effective cost to operate them over the long term.
I think building easier to scale and build, costing less, and then SMRs have the potential for enhanced safety and security compared to some of the early nuclear designs, which we're excited about. Safety and security is part of everything that we do here at Amazon, in particular here at AWS.We think that those aspects are important. A lot of that safety comes from the passive designs that the plants are going to be designed to operate without human intervention. If you look at the past incidents that have happened with nuclear reactors, they have often been related to personnel errors. I think that the industry is learning from that to increase the safety by leaning on those passive devices.
Then finally, I think the increased efficiency of the fuel use, which will reduce fuel waste, generating less of that really radioactive waste that we have to deal with, which is the one drawback of nuclear power. If you're driving efficiency into that and you make less of it, then I think that there's some benefits there. Those are the main reasons. Easier to build and scale, we think that we can drive cost out, and then the safety and security and fuel efficiency of small modular reactors is what's driven us to go and invest in that technology.
Chad: That's a great overview and really provides some of the great benefits as well as the economy-wide benefits. Can you tell us specifically, you've announced a few different partnerships in this space, one with X-energy, a developer of SMRs, one with Energy Northwest in your region, headquarters there above Amazon, and one with Dominion, I believe, in the Virginia area. Could you tell us specifically about some of these partnerships and what you're trying to achieve?
Brandon: Yes, it's public knowledge that we invested in X-energy. They're one of the next-generation SMRs that we landed on as it piqued our interest. We made an equity investment. I think that we've made this investment because we saw them as a leading contender. Do we think that they're going to be the only contender that we are 100% right and this is the only technology going forward? No, absolutely not. We saw them as a positive partner. We liked their technology, and we want to see them successful.
I just want to make it really clear, though, that we hope that all of the SMRs that are currently coming out of the ground and being designed are successful. We think that there's more than one solution here. While we're going to focus on X-energy, we're hoping that everybody is successful along the way. Having a small modular reactor is great. You need a partner to go and build the plant and get it interconnected to the grid. That's where our partnership with Energy Northwest comes in. They're going to take the X-energy plants, initially 320 megawatts, and build those out here in the Pacific Northwest, connect them to the grid.
If successful here with our first 320 with an option on an additional 960, we could put enough power on the grid to power more than 770,000 US homes, not to mention all the jobs that will be created while building these as well. We're excited to partner with Energy Northwest in a project that can actually scale. Then Dominion, we obviously have a large presence in northern Virginia. Dominion has been a key partner in our growth there for some period of time. While we were looking at our portfolio, we've got our Northwest partner here with Energy Northwest.
We went to Dominion and said, "Look, we'd really like to partner with you and help come up with a construct where you can permit, design, and run a process to build an SMR to complement your North Anna site." Just so happened they had land there. It's been in their IRPs for many years to get another asset built and generating there. They were just looking for a partner to come in and help de-risk that a little bit. We're going to partner with them. Details still need to be figured out, but we want to go and try to bring on 300 megawatts of small modular reactors to that North Anna site so they can help offset some of the growth that we're seeing all over the electric grid like we talked about earlier.
Chad: That's all very exciting developments and definitely applaud your efforts in this space. I watched your recent event with outgoing Energy Secretary Jennifer Granholm, who really touted your efforts in nuclear procurement here and helping the US meet its climate goals. There's obviously a new administration coming in where I think one really strong overlap between the outgoing administration and incoming administration is support for nuclear as a growing part of our energy mix in the United States. What are your thoughts on the future of nuclear energy here in the US?
Brandon: Look, I'm really excited that nuclear power is a bipartisan issue. I think that you just hit on it. Last month, right before a major election, we had a stage full of people from both sides of the aisle that were excited about a nuclear power announcement from Amazon. We all stood together and said this is the right thing to do for the energy sector. This is the right thing to do to drive economic growth. This is the right thing to do to generate power cleanly. It's nice to be right in that intersection where no matter which side of the aisle you're on, what color you vote, whatever, that we can all agree that these make sense.
I think that we're going to see some long-term support for nuclear. I think that's going to do a lot of great things for the electricity grid and honestly, for us to go and drive towards our net zero carbon goals by 2040. As an engineer, I'm happy that now we just get to go and focus on some of the technology challenges and some of the financial challenges, and at least have support from all of our government entities.
Chad: Brandon, thank you so much. Learned a lot today. We're almost done, butfirst we have what's called the hot seat. We ask for your immediate reactions to the following statements and questions.
Brandon: All right.
Chad: Something I thought was true that I no longer believe.
Brandon: Something I thought was true that I no longer believe. All right. Early on in my career, I thought I could solve everything with an equation. being an engineer figured, "Hey, there's a problem, there's got to be an equation and a solution and things come out binary." Now, fast forward, a couple of decades, a couple of knowledge bumps along the way, I see that equations definitely guide my decision-making and help me get to the like, right outcome, but how we arrive there now is always an adventure. There's shades of gray. There's how people's feelings are. I think that learning pretty early on in my career, thankfully, that I can't solve anything, that's definitely something that I no longer believe.
Chad: I'm most proud of?
Brandon: Working for Amazon. Work for a company that has the culture of innovation, but then the financial backing to deploy technologies, like we just spent 20 minutes talking about changing people's lives, that's one. Then I guess I'd be remiss of, if I look at my household, my wife is an elementary school teacher. We're teaching youth of America on one side of the household, and then building out the next generation of nuclear power and carbon-free assets on the other one. Pretty proud of that.
Chad: That's awesome. To recharge, I-
Brandon: -go fishing. I love to fish and spend time with my son. He's not even out of middle school yet, and he's already caught all five native species of salmon here in the Pacific Northwest. Whether it's, I don't know, in the Sound, on the Columbia River, out in the ocean, I'll fish wherever there's water. One of the most fun places I recharged with him fishing was in Botswana. We got to fish in the Okavango Delta and catch tiger fish a couple of years ago. That was a lot of fun. Fishing's my spot to relax and recharge.
Chad: A book or article that has influenced me most is--
Brandon: Can't Hurt Me by David Goggins. I got a little bit of a military background. David Goggins is a Navy SEAL. Chad, I'm not going to lie to you, this isn't a book I'd recommend to everybody. It's got some pretty graphic discussions in there. The theme throughout the book is about building grit as a person. Digging deeper into what he calls your gas tank, when you think you're tired. I don't know whether you run or dive or ski, snowboard, whatever. There are days where you, or even just general work, where you feel like you're just tired and you don't have any more in you.
He has a chapter in the book where he's running an ultra marathon, doing 100 miles in under 24 hours. He talks about feeling like he's spent, but learning that you've really only tapped 60% of your gas tank. I think this one rings true throughout the day. There can be days here that are pretty taxing. At the end of the day, if you just continue to push and drive, I think through David, I'm not going to go and run 100 miles. I'm not a marathoner. If I'm tired at the end of the day, I think through him a bit. That's top of mind.
Chad: Good lessons for life there. Aside from the fishing, what is the most underrated aspect of life in Seattle?
Brandon: Summer. The summers in Seattle just don't get any better. I grew up in Virginia. I've been out here in Seattle for almost 20 years now. My favorite time of year is from roughly end of July through October. It's beautiful. I can go dive Puget Sound in the morning and then go and hike in Alpen Lake in the afternoon. I haven't found many other places here in the US or even around the world that compare.
Chad: Yes. Seattle is a special place. Visited several times and always enjoyed it. Finally, to me, climate positive means?
Brandon: Doing my darnedest to create more good than harm for the planet. We hit on this earlier. I want to leave things better than I found them. Obviously being a dad, that's a little bit important. Just generally, I just want to do good. I think that we're in a good spot here. SMRs are putting us on a good trajectory. We can drive out carbon. I've worked on different sustainability initiatives in my time here at Amazon. I think climate-positive is just simply that. Do more good than you do harm.
Chad: Excellent. This has been a great discussion, Brandon. Really appreciate learning about your background and Amazon's work in the nuclear space and these more personal aspects about you. Really appreciate your time today.
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I'm Chad Reed.
And this is Climate Positive.