(Reuters) – Constellation Energy has signed an exclusive agreement with Microsoft to restart one of the units at the notorious Three Mile Island nuclear power plant in Pennsylvania, which will power the tech giant’s data centers, the company announced on Friday.
This would be the first time a nuclear plant in the US has been restarted after being shut down. It shows how utilities are taking advantage of a surge in demand from data center operators looking to capitalize on the rise of artificial intelligence.
The company’s shares rose nearly 8% to $224.4 before the market closed.
The deal would allow a restart of Unit 1 at the five-decade-old nuclear plant in Pennsylvania, which was shut down in 2019 for operational reasons. Unit 2, which was shut down after a partial meltdown in 1979 — the most famous commercial nuclear accident in U.S. history — will not be restarted.
Constellation, which plans to invest about $1.6 billion to restart the plant, is awaiting permits and expects the plant to be operational in 2028.
Under the agreement, announced Friday, Microsoft will purchase power from the rebooted plant for a period of 20 years.
Reuters first reported on the possible restart in July.
A restart is expected to be logistically challenging, but as demand for electricity from technology companies increases, the near-carbon-free electricity source is gaining renewed support.
If the restart is approved, Three Mile Island would provide Microsoft with 835 megawatts of energy.
Financial terms of the deal were not disclosed. Microsoft and Constellation declined to provide further details about the agreement.
(Reporting by Mrinalika Roy and Sourasis Bose in Bengaluru; Editing by Janane Venkatraman and Sriraj Kalluvila)
