Constellation Energy Corp., the largest U.S. reactor operator, expects that, according to a statement the Three Mile Island reactor will be returned to operation in 2028 – Bloomberg reported.
Constellation plans to restart one of the Three Mile Island power plant’s two reactors. The reactor, which was closed in 2019 for economic reasons, will be reactivated. The second reactor, which was permanently shut down almost half a century ago after the worst nuclear accident in the US, will continue to be closed.
For two decades, all the energy produced at Three Mile Island will flow to Microsoft’s data centers.
Microsoft will pay a high price for clean energy from Three Mile Island
Microsoft Corp. intends to pay a high price for energy from the restarted Three Mile Island nuclear power plant. This shows how Emission-free electricity available 24 hours a day is very valuable for the development of artificial intelligence.
According to Bloomberg Intelligence estimates fromand the company will pay at least $100 for a megawatt-hour of power from a Pennsylvania plant. Estimates Jefferies LLC indicates an even higher figure, approximately $112 per megawatt hour.
Meanwhile, Jefferies data shows that a megawatt hour of wind and solar power is currently available in the same region for about $60.
The largest power purchase agreement in Constellation’s history
The companies did not disclose the terms of the 20-year deal. However, the financial details in Constellation’s presentation gave analysts enough data to make estimates.
The contract should provide Constellation about $785 million in annual revenue by 2030according to Paul Zimbardo, an analyst at Jefferies. That’s enough to justify the $1.6 billion the company expects to spend to restart the reactor.
The agreement to supply electricity to Microsoft from the 837-megawatt reactor is the largest power purchase agreement in Constellation’s history.
Artificial intelligence will launch other reactors?
The case of Constellation and Microsoft is the latest sign of growing interest in the nuclear industry as energy demands for artificial intelligence skyrocket.
Due to increasing competition from cheaper natural gas and renewable energy over the last decade in the US more than a dozen reactors were shut down. However, the growing demand for electricity, especially from data centers, but also from other consumers, e.g. car factories, has stimulated interest in nuclear power plants that can provide emission-free energy around the clock.
Holtec International is attempting to restart the closed reactorwith approximately $1.8 billion in contingent financing from the U.S. Department of Energy and the state of Michigan. NextEra Energy Inc. also said it was considering reviving a closed reactor in Iowain part to supply data center customers. However, according to experts, these three cases end the list of well-preserved reactors that may be suitable for restarting.
Microsoft isn’t the only one looking to nuclear power
Wind and solar power production can vary, while a nuclear power plant typically runs continuously and requires a customer that can take on all that electricity. This makes technology companies selling cloud computing an ideal option.
Microsoft isn’t the only tech company looking to nuclear power to fuel its artificial intelligence ambitions. Earlier this year, Amazon.com Inc.’s cloud computing division agreed to spend $650 million to acquire a data center campus connected to Talen Energy Corp.’s 40-year-old nuclear power plant. on the Susquehanna River in Pennsylvania.
