Microsoft Signs $1.6 Billion Deal to Power Data Centers with Revived Nuclear Plant

Constellation Energy is reviving its Three Mile Island Unit 1 nuclear reactor, which was shut down in 2019 due to economic reasons. The company has signed a 20-year power purchase agreement with Microsoft, worth $1.6 billion, to restart the plant by 2027.

The reactor, located near Harrisburg, Pennsylvania, is notable because it was not damaged during the 1979 partial meltdown of its twin unit at Three Mile Island. It continued to operate for decades, producing one of the best operating records in the US nuclear fleet before being shut down due to cheap gas prices.

The restart will provide 835 megawatts of carbon-free power to Microsoft's data centers, which are expected to double their electricity use by 2030. Constellation is spending $1.6 billion to refurbish the plant and rebuild its workforce, with a $1 billion federal loan from the Department of Energy.

However, critics argue that the restart is misguided, pointing out that ratepayers will foot the bill for the new reactor's operation and maintenance costs. They also note that the reactor's output will be sold exclusively to Microsoft, leaving other customers without access to this emissions-free power.