Constellation Energy (NASDAQ:CEG) plans to revive Three Mile Island (TMI) Unit 1 under a 20 year power purchase agreement with Microsoft (NASDAQ:MSFT) announced on Friday (September 20).
According to the company, the deal will bring 835 megawatts of carbon-free energy back to the grid and will create over 3,400 jobs. It is expected to generate over US$3 billion in taxes and US$16 billion for Pennsylvania’s economy.
The long-term power purchase agreement with Microsoft is the largest in Constellation’s history, and will facilitate the restart of TMI Unit 1, which was shut down in 2019 for economic reasons.
TMI Unit 2 was the site of the worst nuclear accident in US history in 1979, when its reactor core partially melted down. It is separate from TMI Unit 1 and has a different owner. The reactor is currently being decommissioned.
Joe Dominguez, CEO of Constellation, underscored the critical role of nuclear energy in sustainably meeting the state’s energy needs. Microsoft plans to use the power to run data centers used for technology like artificial intelligence.
‘We are especially honored to name this new plant after our former CEO Chris Crane, who was a fierce advocate for our business, devoting his entire career to the safe, reliable operation of our nation’s nuclear fleet, and we will continue that legacy at the Crane Clean Energy Center,’ Dominguez added in Constellation’s press release.
The restart process will involve extensive upgrades to key components, including the turbine, generator and control systems. The restoration is expected to take several years, with the facility projected to be back online by 2028.
Constellation is also seeking approval to extend TMI Unit 1’s operating license through 2054.
For its part, Microsoft described the agreement as a major milestone in its decarbonization efforts.
“Microsoft continues to collaborate with energy providers to develop carbon-free energy sources to help meet the grids’ capacity and reliability needs,” said Bobby Hollis, Microsoft’s vice president of energy.
In an effort to further support the local community, Constellation has committed to providing US$1 million in philanthropic funding over the next five years. The company has indicated that funds will be directed toward workforce development programs and other community initiatives.
Public support for nuclear energy is strong in Pennsylvania.
A recent poll by Susquehanna Polling & Research found that 70 percent of state residents support the continued use of nuclear energy, while also revealing that a majority of respondents favor TMI Unit 1’s restart.
The restart comes amid renewed global interest in nuclear energy as countries seek to decarbonize. Nuclear reactors, which can operate continuously for extended periods, are seen as a key solution for providing stable, clean energy.
Securities Disclosure: I, Giann Liguid, hold no direct investment interest in any company mentioned in this article.