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AI could breathe new life into Three Mile Island to power Microsoft's data centers

AI could breathe new life into Three Mile Island to power Microsoft's data centers

Harrisburg, Pennsylvania. – The owner of the decommissioned Three Mile Island nuclear power plant said Friday it plans to restart the reactor under a 20-year agreement that will see tech giant Microsoft buy the electricity to power its data centers with carbon-free energy.

Constellation Energy's announcement comes five years after its then-parent company Exelon closed the plant, saying it was making losses and Pennsylvania state lawmakers rejected a bailout.

The plan to restart the first reactor block at Three Mile Island comes at a time of nuclear power renaissance. Politicians are increasingly pinning their hopes on nuclear power to save the ailing power supply, avoid the worst effects of climate change and meet the growing electricity demand of data centers.

The power plant, located on an island in the Susquehanna River just outside Harrisburg, was the scene of the worst commercial nuclear accident in the United States in 1979. The accident destroyed one reactor (Block 2), while only one functioning reactor (Block 1) remained in the power plant.

The purchase of the electricity is intended to help Microsoft meet its commitment to be “carbon negative” by 2030.

Constellation hopes to bring Unit 1 online in 2028 and will seek a license extension from regulators to extend the plant's operation until at least 2054. Restarting the reactor will require approval from the U.S. Nuclear Regulatory Commission and approvals from state and local authorities, Constellation said.

In preparation for the restart of Unit 1, “significant investments” are needed to restore the plant, including the turbine, generator, main transformer and cooling and control systems, Constellation said.

Constellation has not provided any information on how much this will cost, nor have Microsoft and Constellation disclosed terms of their agreement.

Jacopo Buongiorno, a professor of nuclear science and engineering and director of the Center for Advanced Nuclear Energy Systems at MIT, estimates that the cost of restarting the reactor will be in the billions of dollars. Microsoft will likely pay more than the market price for carbon-free and reliable electricity, Buongiorno said.

Restarting the power plant is realistic but not easy, said Buongiorno.

“It all depends on the condition of the components and systems,” said Buongiorno.

The process will be relatively smooth if the assets have been well maintained during the shutdown, Buongiorno said. However, if everything has been abandoned or dismantled, Constellation will be busy replacing or refurbishing the assets for a long time, he said.

The next example of a nuclear power plant being restarted is underway in Michigan, Buongiorno said, where the federal government has pledged a $1.5 billion loan to restart the Palisades nuclear power plant, which is scheduled to shut down in 2022.

The business model of the agreement between Constellation and Microsoft makes sense for both sides, Buongiorno said. It is also cheaper to restart a nuclear power plant than to build one from scratch, he said. Transmission lines, cooling towers, control buildings and concrete shells are already intact, he said.

Constellation's announcement comes after a wave of coal and nuclear power plant closures over the past decade as competition from cheap natural gas flooded electricity markets.

This has led to warnings that the US is facing a power crisis. At the same time, demand from data centres operated by tech giants such as Meta, Amazon, Microsoft and Google to provide cloud computing and digital services such as artificial intelligence systems is growing rapidly.

In the US, the growth in electricity demand is concentrated in states – especially Virginia and Texas – where there is rapid development of large data centers, the US Energy Information Administration said.

Data centers currently account for about 4% of U.S. electricity consumption, and some forecasts predict that share will double by 2030.

The agreement between Constellation and Microsoft comes amid efforts by the Biden administration, states and utilities to rethink the use of nuclear energy to mitigate the effects of climate change and limit the energy sector's climate-damaging greenhouse gas emissions.

Last year, Georgia Power began generating electricity from America's first nuclear reactor in decades, built from scratch after the Three Mile Island accident killed interest in building new reactors.

Before its shutdown in 2019, Three Mile Island's Unit 1 had a generating capacity of 837 megawatts, enough to power more than 800,000 homes, Constellation said.

The destroyed Unit 2 is sealed and its two cooling towers are still standing. The core was shipped to the U.S. Department of Energy's Idaho National Laboratory years ago. What remains inside the containment vessel remains highly radioactive and encased in concrete.

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