Google to Secure Half Output from Finnish Nuclear Plant Until 2049
Alphabet Inc., through its Google division, has entered into a long-term agreement with Finland’s Fortum Oyj (HE: FORTUM) to purchase half the output of the Loviisa nuclear plant until 2049. The deal is part of Alphabet's broader $15 billion investment in AI infrastructure and aims to stabilize electricity costs for its data centers, particularly those located in northern regions where cooling expenses are reduced due to colder climates. The power purchase agreement (PPA) locks in a predictable energy cost over two decades, addressing one of the most volatile operating expenses in hyperscale computing. This move is intended to lower Alphabet’s per-unit AI compute costs as it scales its cloud and Gemini model operations. However, electricity deliveries won’t begin until 2031, raising questions about whether this will provide immediate financial benefits. Alphabet has significantly increased capital expenditures recently, with $45 billion spent in Q2 alone on infrastructure expansion. The company’s balance sheet is under pressure as free cash flow turned negative and long-term debt doubled to $98 billion.
Topics: AI infrastructure corporate strategy electricity costs nuclear energy