X-energy and U.S. utility giant American Electric Power (AEP) announced on October 19, 2026, that they have signed a joint development agreement to develop a nuclear power plant in Indiana with 12 small modular reactors (SMRs) and a total output of 960 MW. Amazon will help fund development, and the plan envisions eventually supplying power to the regional grid and to Amazon's data centers. Following Washington state, the Amazon–X-energy nuclear partnership now has a specific candidate site in the U.S. Midwest as well. However, the agreement is for advancing a feasibility study, and construction has not been decided. The key question is whether a business model that combines Amazon's development funding with a future long-term power purchase agreement will actually lead to construction.
12 small reactors totaling 960 MW, on the site of a retired coal plant
The candidate site is near the former Breed coal-fired power plant in Sullivan County, Indiana. According to X-energy's announcement, the study will examine whether land owned by AEP can be converted into an advanced nuclear plant. The plan reuses an industrial site that previously hosted power generation, but it remains unclear how much of the existing transmission infrastructure can be used, or whether grid interconnection will be approved.
The reactor under consideration is X-energy's high-temperature gas-cooled reactor, the Xe-100. According to AEP's announcement, each unit has an electrical output of 80 MW, and the plan assumes 12 units installed in groups of four. Four units equal 320 MW, and the whole facility would total 960 MW. Although each reactor is small, combining multiple units is intended to secure large-scale generating capacity. Note that 960 MW represents the maximum planned generating capacity; it does not indicate annual electricity output or the amount of new power that can be supplied at this point.
The three companies will play different roles in this partnership. X-energy provides the reactor technology, Amazon supports development funding and future power demand, and AEP contributes its expertise as a utility and its nuclear plant operating experience. AEP and its subsidiary Indiana Michigan Power (I&M) have more than 50 years of experience operating nuclear plants, and Amazon cites that track record as a strength of the project.
According to Amazon's explanation, the electricity generated is expected to be used both on the regional grid and at its own data centers. The aim is to increase regional power supply capacity while securing the electricity needed for data center expansion. But the plant's scale alone does not determine whether the project is feasible. What matters is who bears development and construction costs, and how costs will be recovered after operations begin.
Amazon provides development funding, with long-term power purchases meant to support the project
A distinctive feature of this plan is that Amazon is involved financially before construction begins. According to X-energy, Amazon will provide funding according to development progress and the achievement of certain milestones. Meanwhile, the long-term power purchase agreement described by AEP presupposes moving on to construction and commercial operation after a final investment decision. In other words, the current development funding and the power purchase payments made after the plant starts operating are funds from different stages.
Breaking down the three companies' announcements by stage, from feasibility study to commercial operation, gives the following picture.
| Stage | What has been announced | Current conditions |
|---|---|---|
| Feasibility study | X-energy and AEP signed a joint development agreement, and Amazon supports development funding | Funding is provided as milestones are met. Amazon has not been confirmed to bear the entire construction cost |
| Move to construction | Concept of proceeding to construction after the study results and a final investment decision | This agreement alone does not mean construction is decided |
| After commercial operation begins | Amazon intends to be the first power purchaser, buying electricity under a long-term contract | Assumed to cover the plant's capital and operating costs during the contract term |
AEP has outlined a concept in which a long-term power purchase agreement with Amazon would cover the plant's capital and operating costs during the contract term. However, this announcement did not disclose the specific amount of development funding, the electricity purchase price, or the contract length. It is also unknown how costs would be shared if construction costs exceeded initial estimates. For this reason, it cannot be concluded at this stage that Amazon will bear the entire construction cost. The table above summarizes the companies' public statements and is not the result of reviewing the full text of the contracts.
Still, it is significant that a large power consumer is participating from the development stage. Typically, in developing a new power plant, the outlook for who will buy the power and what revenue it will bring determines the project's profitability. In this plan, Amazon's stated intention to be the first purchaser gives some visibility into future demand. Amazon also explains that demonstrating long-term purchasing demand helps commercialize nuclear projects. But foreseeable future demand is a separate matter from securing construction financing and project profitability.
Construction and licensing of the earlier Xe-100 project will be key to commercialization
The Xe-100 is a high-temperature gas-cooled reactor that uses helium as a coolant and "TRISO" coated-particle fuel. TRISO fuel is structured so that uranium-containing fuel particles are wrapped in multiple heat-resistant ceramic and other layers, and it is designed to contain radioactive materials even under severe temperature conditions. Amazon emphasizes the safety of the design that combines this fuel with helium cooling. However, because the reactor coolant is helium does not mean the plant as a whole uses no water. For the cooling method of the power generation equipment, X-energy says air cooling, water cooling, or a combination of both can be chosen depending on site conditions.
X-energy's earlier project is a plan to supply electricity and high-temperature industrial steam to a manufacturing site of chemical giant Dow in Texas. Four Xe-100 units are to be installed at this facility, and in this announcement the company explained that the U.S. Nuclear Regulatory Commission (NRC) review of the construction permit application is in its final stage. On the other hand, according to TechCrunch's report, construction of this Seadrift project has not yet started. To advance the 12-unit Indiana plan as well, a track record will need to be built through the construction and operation of the earlier Xe-100 project.
The relationship between Amazon and X-energy did not begin with this power plant plan. Amazon led X-energy's fundraising in 2024, and the round ultimately closed at $700 million. The funds are planned to be used to advance reactor design and licensing, as well as the first phase of the TRISO-X fuel fabrication facility to be built in Oak Ridge, Tennessee. However, $700 million is the total for the fundraising round; it is neither Amazon's investment alone nor the construction budget needed for the Indiana plant.
The two companies, working with regional utilities, have set a goal of bringing more than 5 GW of new nuclear generating capacity online in the United States by 2039. The Indiana plan is their second collaborative project, following the Cascade Advanced Energy Facility in Washington state. By advancing plans in multiple regions, they aim to commercialize the reactor technology and fuel supply system. However, the 2039 deadline refers to the nationwide deployment goal, and it has not been decided that the Indiana plant will be operating that year.
Can local electricity rates be protected? Challenges remain before a construction decision
Amazon explains that if the Indiana plant plan is realized, it could create more than 1,000 jobs during construction and more than 100 permanent jobs after commercial operation begins. AEP also expects local job creation and increased tax revenue, but these are projections that assume the project proceeds to construction and operation, not economic benefits already realized. Assessing the contribution to the local economy will require checking actual investment amounts, construction progress, and the scale of employment.
For local residents and existing electricity customers, the impact on electricity rates matters as much as jobs and tax revenue. AEP explains that it will include financial protections in the agreement to limit the burden on existing customers. Amazon has also stated a policy of not passing costs associated with its own demand on to other users and of paying the necessary costs. However, because the specific power purchase price, contract length, and cost-overrun terms have not been disclosed, this is not yet a stage at which it can be independently confirmed that future rates will be unaffected.
X-energy itself acknowledges risks to commercialization. Depending on the results of the feasibility study, development may not be able to continue, and it also anticipates that necessary additional agreements may not be concluded. Furthermore, multiple conditions must be met before a final investment decision, including nuclear regulatory licensing, the suitability of the candidate site, financing, and project profitability. That the land was already used for power generation and that AEP has long nuclear operating experience are strengths, but they do not by themselves make construction certain.
With this joint development agreement, the concept of building a 960 MW nuclear plant in Indiana has advanced to a stage with a specific candidate site and development funding support. Going forward, in addition to the feasibility study results, the progress of construction and licensing of the earlier Xe-100 project and the terms of the long-term power purchase agreement with Amazon will be important. In particular, if the purchase price, contract length, and the cost-sharing ratio in case construction costs exceed expectations become clear, it will be possible to evaluate more concretely whether Amazon's long-term power demand and a mechanism to protect local electricity rates can coexist. Whether these conditions are met and a final investment decision is reached will be the key to turning the 960 MW plan into actual power supply.