Virginia, home to the nation's largest concentration of data centers, faces a critical crossroads in its energy future. As the demand for data storage and processing increases, so does the need for reliable, sustainable, and affordable energy to power these facilities. 100mw (MW) of power. This is equivalent to the output of a single large utility-scale facility and is enough to power tens of thousands of homes. The rise of AI will significantly increase data center power demands.
So what should we do about data centers?
Policy makers and energy providers are exploring the potential of small modular reactors (SMRs) to meet the growing energy demands of the data center industry. SMRs offer the potential for clean and reliable energy, but their development and deployment faces significant challenges and limitations.
SMR is a type of nuclear reactor that is smaller in size and power compared to conventional nuclear power plants. They are designed to be modular, meaning they can be assembled at the factory and transported to the installation site, potentially reducing construction time and costs. SMRs typically have a power output of around 300 MW (MW) and can be used for a variety of applications. An example of this is generating electricity to power data centers that require megawatts. In 2022, Gov. Glenn Youngkin suggested building the state's first SMR in southwest Virginia, but in March, the governor reverse courseand the focus has shifted to regions with more established nuclear infrastructure.
The industry is gearing up for the potential adoption of SMR as part of the data center power stack. When Microsoft launched a national investigation, officials definitely noticed.principal program manager About nuclear energy and when did it come into existence? announced In January 2024, the company announced the hiring of a director of nuclear technology and nuclear acceleration.
A wise and balanced approach is critical to helping Virginia navigate this complex energy landscape. SMR is not a panacea. We must continue to recognize the important role of solar energy and other renewable resources in our state's energy mix. Only by adopting a diverse and comprehensive energy strategy can Virginia meet the demands of a rapidly growing data center industry while ensuring a sustainable and prosperous future for all of Virginia. Additionally, this embrace of diversity is critical for Dominion Energy to meet its legal requirement under the Virginia Clean Economy Act to produce 100% of its energy from renewable sources by 2045.
Risks of over-reliance on SMR
While SMR is a promising avenue for clean energy production, it is important to recognize that it is not a silver bullet for Virginia's energy challenges. One of the most significant risks associated with the overemphasis on SMR is that the technology, which is years away from becoming a reality, could be used as an excuse to block the development of solar energy projects in rural Virginia counties. It is a matter of gender.
Opposition to solar power development has grown in many rural areas of the state in recent years. As pointed out earlier, Explanation An article in the Virginia Mercury said, “There is a clear trend emerging that Virginia counties are intentionally limiting their options. This opposition is often rooted in concerns about the impact of solar projects on local land use, property values, and aesthetics. A frequently cited argument by opponents is that the energy produced on these rural farms is “just being sent all the way to Northern Virginia.”
The promise of SMR risks exacerbating this trend by providing opponents of solar development with new arguments to justify their position. They may argue that with SMR on the horizon, there is no need to invest in solar power projects that could have a negative impact on local communities. However, this reasoning ignores the fact that SMR is still years, perhaps even 20 years away from widespread adoption and faces significant permitting challenges. Additionally, once a site is identified, it will almost certainly face opposition from local “NIMBYs” itself. It's also worth noting that one of his SMRs produces the equivalent of two orange solar power plants. This is not the kind of power generation you would discuss with solar power.
Virginia lawmakers recently authorized Dominion Energy and Appalachian Power to proceed with early development work on two nuclear reactors, said Virginia Mercury columnist Ivy Mayne. Pay attention to the colorful“This is not a fix. It's like having a heart attack today and scheduling knee surgery for next year.”
Therefore, stifling the development of today's reliable and cost-effective renewable energy and overemphasizing the current importance of SMR in meeting Virginia's energy needs puts Virginia in great danger. may put you in a precarious position.
The need for a balanced and holistic energy approach
Adopt a balanced, holistic approach that embraces a diverse mix of energy sources to meet Virginia's data center industry's growing energy demands while ensuring a sustainable and resilient energy future It is essential to do so. This approach should include a combination of energy derived from fossil fuels as well as other renewable resources such as SMR, solar energy, wind and hydropower. Fossil fuels continue to play an important role in Virginia's energy mix, and are likely to continue to do so for the foreseeable future, although they are becoming less important over time. It is unrealistic to suggest otherwise.
Although promising, SMR faces significant challenges that may delay widespread deployment beyond a 20-year period. First, such projects must be subject to significant licensing requirements at the state and federal level, including the Nuclear Regulatory Commission, whose process includes extensive reviews of safety, environmental, waste management, and other issues related to nuclear projects. are facing challenges.
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Nuclear energy is also expensive, especially when compared to solar power.according to Analysis of 2023 According to Lazard, a financial advisory and asset management company, the cost of generating electricity from new U.S. nuclear power plants is significantly higher than the cost of solar energy, even when energy storage is taken into account. Lazard estimates that the unsubsidized levelized cost of electricity (LCOE) for new nuclear power plants will range from $141 to $221 per megawatt hour (MWh).
By contrast, Lazard predicts that the unsubsidized LCOE for newly built utility-scale solar facilities will range from $24 to $96 per MWh. This means that on average, solar energy with storage is less than half the cost Total electricity generated from new nuclear power plants. (It is fair to acknowledge that these costs are current estimates and that nuclear power may become even more cost-effective over time, for example due to improvements in technology.)
These cost differences have significant implications for Virginia's energy future. By prioritizing solar energy development now, the state can not only reduce carbon emissions, but also help keep electricity affordable for consumers and businesses. Additionally, the lower cost of solar energy will help attract new industries and businesses to the state, spurring economic growth and job creation.
In the end, the key to Virginia's energy future lies not in making the wrong choice between SMR and solar power, but rather in choosing between each energy source and traditional energy sources while working to reduce dependence on fossil fuels. It lies in a comprehensive approach that recognizes strengths and limitations. And reduce your carbon footprint over time. When it comes to energy, focus on all of the above, rather than one or the other.
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