Federal government to turn a Kentucky uranium plant into an AI data center and gas power complex

PADUCAH, Ky. -- The U.S. Department of Energy is harnessing the artificial intelligence boom in its bid to convert another Cold War-era uranium enrichment site, tapping private equity to fund a $100 billion data center complex that will include its own new natural gas and battery storage power plant in Kentucky.

The department selected investment firm Brookfield Asset Management to develop and operate the data center at the government-owned Paducah Gaseous Diffusion Plant. In March, the department announced a similar project at its Portsmouth Gaseous Diffusion Plant in Ohio.

Both are undergoing extensive cleanup, decontamination and decommissioning after decades of fueling the nation's nuclear weapons and power plants. The project is in line with the Trump administration's efforts to make artificial intelligence superiority over China a top national security and economic priority.

The federal government is transforming former DOE sites into "engines of innovation and economic growth" to "ensure the United States wins the A.I. race,” Energy Secretary Chris Wright said in a statement Wednesday.

"There will be a lot of new natural gas power plants, a large data center, thousands of jobs and tens of billions of dollars of investment in rural western Kentucky," Wright said on the Fox News show “Fox & Friends.”

Earlier in July, the Department of Energy said it had picked engineering contractor Amentum to negotiate a lease to develop an AI data center and on-site power plant at South Carolina's Savannah River Site, a massive complex where the federal government once produced materials used in nuclear weapons, primarily tritium and plutonium-239.

Real estate, energy and data center services are cornerstones in the investment portfolio of New York-headquartered Brookfield, which reports that it has more than $1 trillion in assets under management.

Other partners in the Paducah projects are power generation and transmission giant NextEra Energy and local utilities.

Florida-based NextEra Energy will build and own the power plant, which is to include 2 gigawatts of natural gas-fired generation, upgrades to transmission networks and 2.6 gigawatts of battery energy storage to support a new 1.8 gigawatt AI data center campus, the department said.

A single gigawatt, according to a general industry standard for utilities, can power about 750,000 homes.

A power service agreement must be approved by state utility regulators, and excess electricity would be delivered to the regional grid. Construction was expected to be complete in 2031, the department said.

The public-private partnership is designed to continue the environmental cleanup at the roughly 3,550-acre Paducah plant site, which was on a list of 16 federal sites released last year as locations where the department could invite technology companies to build data management and storage capacity.

It shut down in 2013 and the gaseous diffusion process to enrich uranium is considered obsolete.

The department has projected that cleanup at the Paducah site would be completed in 2065 at a cost of about $17 billion, including demolishing buildings, disassembling uranium converters, removing refrigerant and treating a large plume of groundwater contamination.