AEP, Amazon and X-energy Explore 960-MW Nuclear Plant at Retired Indiana Coal Site

AEP said on Oct. 19 that it signed a joint development agreement with X-energy to evaluate the feasibility of a 960-megawatt advanced nuclear project at the former site of Indiana Michigan Power's Breed Generating Station, a retired coal plant in Sullivan County, Indiana. The initial design calls for 12 of X-energy's Xe-100 reactors of 80 MW each, arranged in three groups of four. AMZN is supporting development through a funding agreement and, according to AEP's release, intends to buy the plant's output under a long-term contract that covers its costs and operations.

The project is early. It still needs a final investment decision, and the companies did not disclose a capital cost, the size of Amazon's funding, contract terms or a timeline. Amazon's payments apply only "if the project is built and enters commercial operation". AEP CEO Bill Fehrman said the agreements "will provide all necessary capital protections and financial safeguards," and Amazon's Josh Weissman said the company aims to "pay our full costs without passing them to others." World Nuclear News reports the project could create about 1,000 construction jobs and 100 permanent jobs.

It would be Amazon's second grid-scale project with X-energy, after the Cascade plant planned with Energy Northwest in Washington, which starts at four Xe-100 units and 320 MW. Amazon's Climate Pledge Fund led X-energy's $700 million Series C-1, and the two companies target more than 5 GW of new U.S. nuclear capacity by 2039. Demand is the backdrop: Indiana's peak load is expected to exceed 7,000 MW by 2030, up from 2,800 MW, and Amazon separately signed a 20-year, 690-MW power deal with Constellation for Calvert Cliffs on Sept. 30.

X-energy (Nasdaq: XE) stock surged 10% in pre-open trading to as high as $11.26, according to Investing.com, but the gain did not hold: SentiSense's delayed quote showed the shares near $10.36, roughly flat, in early afternoon. The stock priced its IPO at $23 in April, so it remains down by more than half. Piper Sandler, which rates it Underweight, trimmed its target to $8 from $9 the same day.

The milestones to watch are a definitive power purchase contract with Amazon, disclosure of the project's cost and schedule, the regulatory filings a new reactor needs, and a final investment decision. Until then, this is a funded feasibility study rather than a committed build.