【CEG Performance】Constellation's first-quarter profit exceeds expectations, maintains full-year guidance Nuclear power restart becomes a focus

U.S. power and nuclear energy company Constellation Energy (NYSE: CEG) announced its first-quarter results, with adjusted operating earnings per share of $2.74, beating market expectations; GAAP earnings per share rose from $0.38 in the same period last year to $4.49. The company maintained its full-year adjusted operating earnings per share guidance of $11 to $12. The stock reacted mildly after the earnings, currently trading at $298.91, down 1.55%.

Constellation’s first-quarter revenue was $11.12B, exceeding market expectations. The company stated that the growth in adjusted operating profit was mainly due to the contribution from the Calpine acquisition and improved market and portfolio conditions, although some gains were offset by increased outages for nuclear power plant maintenance.

CEO Joseph Dominguez said the company’s current focus is on execution, including maintaining high operational levels, integrating the two companies, deploying new power resources into the market, and responding to the evolving regulatory environment. The company also announced that it repurchased approximately 1.2 million shares in the first quarter, at an average price of about $285, involving $335 million.

Nuclear output slightly declined year-over-year, with increased outage days

In terms of operations, Constellation’s nuclear power plants generated 44,666 gigawatt-hours (GWh) in the first quarter, down from 45,582 GWh in the same period last year. Excluding Salem and South Texas Project, the capacity factor of the company’s nuclear plants was 92.3% in the first quarter, lower than 94.1% last year. Planned refueling outage days totaled 99 days, up from 88 days in the same period last year.

Other projects also made progress. The 105 MW Pastoria solar project was commissioned on April 16; the 460 MW Pin Oak Creek Energy Center began commercial operation on April 30, providing peak power capacity to the Texas grid.

AI data center power demand becomes a focus

The company stated that the Texas Public Utility Commission approved its net metering application for the co-location of the Freestone site with CyrusOne data center, though with conditions. In February, Constellation signed a 380 MW agreement with data center operator CyrusOne to supply power to a new data center near the Freestone Energy Center, along with a second-phase exclusive agreement of the same scale, 380 MW.

Additionally, the company submitted about 5,000 MW of new capacity resources to the PJM interconnection queue, including nuclear upgrades, new natural gas, and battery storage projects, reflecting preparations for large electricity consumers and data centers.

Three Mile Island restart could be decided as early as June or July

Constellation management stated during the earnings call that U.S. regulators could make a decision as early as June or July regarding the restart of the Three Mile Island nuclear plant in Pennsylvania. The plant has been renamed Crane Clean Energy Center, with Constellation aiming to restart it next year.

The restart project is related to a power supply contract with Microsoft for its local data center. However, preliminary feedback from PJM indicates that the Crane nuclear plant may not be able to connect to the grid until 2031. Constellation is applying to the U.S. Federal Energy Regulatory Commission for a flexible arrangement, hoping to transfer some of the interconnection rights from the Eddystone natural gas plant near Philadelphia to Crane to address grid connection timing issues.

Dominguez also emphasized that they do not want the public to mistakenly think the plant will not restart sooner. If successful, it would be the first U.S. nuclear plant to fully shut down and then restart.