Constellation sold gas at $1.4 million a megawatt, then priced nuclear at $4.8 million
Constellation's filings show $309 million of trailing free cash flow against $24.7 billion of debt while the company swaps DOJ-mandated gas plants for a $4.3 billion nuclear build priced more than three times higher per megawatt.
Vincent Jiang · 3 min read
A gas plant went for a third of what the new nuclear costs
Constellation Energy−1.52% — Constellation Energy, down 1.52 percent today closed the forced sale of its 606-megawatt Brazos Valley gas plant outside Houston to LS Power on October 14, 2026, and published no price 3. Hart Energy reported the figure: $860 million, about $1.4 million for each megawatt the plant can produce 4.
Six days earlier the company had agreed the other side of the swap: more than $4.3 billion to add 890 megawatts of new nuclear output at 11 reactors for Google, roughly $4,800 a kilowatt, or $4.8 million a megawatt 5. The first uprate delivers no output until 2028 5.
The cash to build it is not in the till
Constellation says its growth is privately funded 2. The filings say the money is thin. Trailing revenue through June 30, 2026, was $31.27 billion with $3.47 billion of net income, but free cash flow, the cash left after operating costs and capital spending, came to $309 million 1. The balance sheet carried $24.7 billion of debt against $697 million of cash 1.
Free cash flow is a tenth of reported profit
Data
| Value | |
|---|---|
| Net income | $3.47B |
| Operating cash flow | $4.21B |
| Free cash flow | $0.31B |
The contracts were written for a rule FERC just killed
Google's 890-megawatt deal was pitched as a direct answer to PJM's proposed "bring your own capacity" rule, under which a new large load could escape curtailment only by funding capacity that is genuinely new 5. On October 9 the Federal Energy Regulatory Commission rejected that rule, three days after the deal was announced, and suspended the backstop meant to fill PJM's 6,831-megawatt shortfall for the 2028 auction year until February 28, 2027 5. The contract does not depend on the rule, but the urgency that shaped its pricing has been set aside for now.
The buyers can also shop elsewhere. On October 19 Amazon signed a 960-megawatt pact with utility AEP and reactor maker X-energy for small modular reactors at a former coal site in Indiana 7. And Quad Cities, one of the six uprate sites, holds a license that expires in December 2032, six years into a 20-year contract that depends on a renewal Constellation has not yet filed 5.
New nuclear costs more than three times the gas plant per megawatt
- Estimate
Data
| Value | |
|---|---|
| Brazos Valley gas | $1.42M/MW |
| Google uprates | $4.83M/MW |
| Calvert Cliffs floor (estimate) | $15.8M/MW |
What decides it is the November 6 print
CIBC, the Canadian bank that launched coverage of Constellation on October 16, rates the stock an outperformer with a $358 target against a $275 quote, and points to the operating record and rising data center demand 1. About 4.4 gigawatts of PJM gas must still clear to LS Power by December 31 3, and the quarterly report due November 6 is the test: whether free cash flow starts closing the gap with reported profit. The number that matters in the November 6 report is free cash flow, not revenue: revenue can grow on the new contracts while the cash left after capital spending stays near $309 million 1.
Deepdive
AI-generated from this story and its cited sources. Not investment advice.
