Constellation Energy, the nation’s largest nuclear power plant operator, has agreed to buy another electricity producer, Calpine, for $16.4 billion, a deal that shows how fast-rising demand for power, partly a result of the data centers being built for artificial intelligence, is having far-reaching effects on the economy.
The cash-and-stock deal, announced Friday, ranks among the power sector’s biggest, and indicates that natural gas is likely to play a larger role than many expected a few years ago in meeting the nation’s electricity needs. That could undermine efforts to address climate change unless companies quickly figure out how to capture and store emissions from gas power plants.
The tie-up would broaden Constellation’s portfolio as companies like Microsoft, Google and Amazon are scrambling to secure energy for data centers used to run artificial intelligence and other services. Energy demand is also rising because of the building of new factories in the United States and greater use of electric vehicles and heat pumps.
Calpine, which is based in Houston and privately held, operates a large fleet of natural gas power plants in several states as well as the Geysers geothermal energy complex in California.
Constellation, which is based in Baltimore, said in a statement that it expected Calpine’s natural gas assets to help ensure the reliability of the electric grid. The combination also would broaden the company’s presence in Texas, where power demand is growing quickly, and add more renewable energy to its portfolio.
“We believe that natural gas and geothermal, along with nuclear, will be critically important for the nation,” Joseph Dominguez, chief executive of Constellation, said on a call with investors and analysts on Friday morning.
He added that it was important to ensure that energy resources were not only sustainable, but reliable as well. “We believe that natural gas and clean energy, blended together, will be very attractive to customers,” Mr. Dominguez said.
Constellation’s stock price soared more than 20 percent in early trading on Friday, an unusually large jump for an acquiring company. Its shares had already more than doubled over the past year as expectations for U.S. power demand growth rose.
Constellation would pay $4.5 billion in cash and assume roughly $12.7 billion of Calpine’s debt as part of the deal.
Nuclear power plants, which can operate around the clock without releasing planet-warming emissions, have been among the early beneficiaries of booming investment in artificial intelligence. Constellation agreed last year to spend $1.6 billion to restart a nuclear reactor at Three Mile Island near Harrisburg, Pa. — a project for which Microsoft is effectively footing the bill.
But there are only a few mothballed nuclear plants that can be restarted. Some companies are also betting on new, smaller reactors, but those are not expected to begin producing meaningful amounts of power for at least several years if all goes well.
As a result of those challenges, many energy and tech companies are increasingly looking to natural gas, even though its use releases carbon dioxide and methane, two leading greenhouse gases that are warming the planet.
“It’s going to be hard for the utilities to provide the power that these data centers need without gas,” said Andrew Gillick, an energy strategist for the analytics firm Enverus.
Power demand from data centers is poised to increase 15 percent a year on average through the end of the decade, Goldman Sachs estimated last year.
Andrew Novotny, chief executive of Calpine, said the combined company would be able to invest in new power generation. “Together, we will be better positioned to bring accelerated investment in everything from zero-emission nuclear to battery storage that will power our economy in a way that puts people and our environment first,” he said in a statement.
A diverse group of power plants could let the new company be more effective in how it manages its resources, depending on how electricity needs change. Adding more natural gas to its portfolio would, however, expose Constellation to more risk related to fluctuating commodity prices, Enverus said.
The deal with Constellation is the culmination of a big turnaround for Calpine, which had come under pressure in recent years as California and other states sought to move away from fossil fuels. A group of investors including Energy Capital Partners took Calpine private several years ago in a deal valued at $5.6 billion, not including debt.
The companies said they expected the transaction to close within a year, subject to regulatory approvals. Constellation would address any potential concerns raised by antitrust officials about its market power by selling assets, Mr. Dominguez said.
Ivan Penn contributed reporting.
