A Member of Pat McKeough’s Inner Circle recently asked for his advice on Constellation, America’s largest fleet of carbon-free nuclear power plants and the leading supplier of clean electricity to homes, businesses, and government entities across the U.S.
All in all, Pat likes the rare combination of irreplaceable infrastructure assets and explosive secular tech tailwinds that position the company for sustained double-digit earnings growth through the decade.
Constellation Energy Corp. (Symbol CEG on New York; www.constellationenergy.com) is the largest producer of emissions-free energy in the U.S. The company is a leading supplier of electricity to businesses, homes, and public-sector customers.
Constellation was spun off by Exelon Corp. on February 1, 2022.
The company’s nuclear, hydro, wind, and solar generation facilities have the capacity to power 16 million homes. They provide about 10% of the clean energy in the U.S.
Constellation has more than 31,676 megawatts (MW) of capacity and output that is nearly 90% carbon free. The company’s capacity breaks down as follows: nuclear, 22,068 MW (69.7% of capacity); natural gas and oil, 7,045 MW (22.2%); and renewable (wind, hydroelectric, and solar), 2,563 MW (8.1%). Plus, it has 4,774 MW of contracted capacity through agreements with other suppliers.
Constellation does business in 48 states, the District of Columbia, Canada, and the U.K.
The company operates through five segments: Midwest (about 37% of generating capacity), Mid-Atlantic (33%), Electric Reliability Council of Texas, or ERCOT (15%), New York (%), and other power regions (6%). The latter includes New England, the Southern and Western U.S., Canada and the U.K.
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Constellation is already the largest producer of emissions-free electricity in the U.S. Calpine also makes the combined company the largest producer of energy from low-emission natural gas generation. In addition, it also expands its renewable energy portfolio, which includes the largest geothermal operation in the U.S.
In January 2026, Constellation completed the acquisition of Calpine Corp. for $16.4 billion.
Calpine owns and operates a collection of natural gas, geothermal, battery storage, and solar assets. The company has over 27 gigawatts of generation capacity.
The merger created the largest clean energy provider in the U.S. It opens opportunities for Constellation to serve more customers coast-to-coast with more types of energy products.
Constellation was already the largest producer of emissions-free electricity in the U.S. Calpine also makes the combined company the largest producer of energy from low-emission natural gas generation. In addition, it also expands its renewable energy portfolio, which includes the largest geothermal operation in the U.S.
Constellation continues to sign long-term power purchase agreements with major technology firms looking for clean energy to power their rapidly expanding AI and cloud operations.
In September 2024, Microsoft Corp. signed a 20-year deal with Constellation to purchase power from the restart of an undamaged reactor at Three Mile Island near Middletown, Pennsylvania. Microsoft won’t use that power directly but has grid-connected datacentres in that region.
In early June 2025, Constellation signed a 20-year deal whereby Meta Platforms will use nuclear energy from Constellation’s Clinton Clean Energy Center in Clinton, Illinois. Financial terms weren’t disclosed, but the Meta deal would help Constellation cover the costs of upgrades, relicensing and maintenance for the facility.
Under what is known as a power-purchase agreement, or PPA, Meta will essentially buy the clean attributes of the nuclear-power generation to offset its less-green electricity use elsewhere. As with Microsoft, Meta doesn’t intend to build a datacentre on-site, and electricity from the plant will continue to flow to the grid.
Notably, Meta’s electricity usage nearly tripled between 2019 and 2023 as the company ramped up its use of datacentres for AI and other projects.
Constellation’s historic government policy shift targets domestic nuclear capacity
All in all, Constellation’s outlook is strong. Demand for nuclear energy is increasing due to rising electricity demand, most recently spurred by power-thirsty AI.
What’s more, it will be easier going forward for Constellation Energy to build new nuclear plants or refurbish existing one. That’s because, on May 23, 2025, U.S. President Donald Trump signed an executive order to streamline the process for building nuclear reactors. Under those changes, the Nuclear Regulatory Commission will have to decide within 18 months whether to approve a proposed reactor project.
Constellation raised its quarterly dividend by 10.0% with the March 2025 payment, to $0.3878 a share from $0.3525. The stock yields 0.5%.
Recommendation in Pat’s Inner Circle: Constellation Energy Corp. is a buy.
