Microsoft wants Three Mile Island to fuel its AI power needs

Microsoft just signed a deal to revive the shuttered Three Mile Island nuclear power plant. If approved by regulators, the software maker would have exclusive rights to 100 percent of the output for its AI data center needs.

Constellation, the owner of the Three Mile Island plant, announced a power purchase agreement with Microsoft earlier today, which should see the site coming back online in 2028, assuming regulators approve it.

The reactor that Microsoft plans to source its energy from was retired in 2019 for economic reasons, and is located next to a unit that was shutdown in 1979 after the worst US nuclear accident in history. The plant that Constellation plans to reopen can generate 837 megawatts of energy, enough to power more than 800,000 homes — demonstrating the huge amount of power needed for data centers and Microsoft’s AI ambitions.

Microsoft has agreed to purchase power from the plant — which will be renamed to the Crane Clean Energy Center to honor the late Chris Crane, former CEO of Exelon — for 20 years in a first of its kind deal for the software giant.

Microsoft’s own greenhouse gas emissions are growing with its focus on AI, putting its ambitious climate goals at risk. Bloomberg reports that this nuclear plant would help Microsoft’s plans to run its data centers on clean energy by 2025, and power data center expansions in Chicago, Virginia, Pennsylvania, and Ohio.

“This agreement is a major milestone in Microsoft’s efforts to help decarbonize the grid in support of our commitment to become carbon negative,” says Bobby Hollis, vice president of energy at Microsoft. “Microsoft continues to collaborate with energy providers to develop carbon-free energy sources to help meet the grids’ capacity and reliability needs.”

Microsoft has been betting on next-generation nuclear reactors to power its data center and AI plans recently, looking for someone who could roll out a plan for small modular reactors (SMR) last year. Microsoft co-founder Bill Gates is also a “big believer that nuclear energy can help us solve the climate problem.”

Constellation will invest $1.6 billion to revive the plant, and the company will need approval from the Nuclear Regulatory Commission to bring the site back online, alongside permits from state and local agencies. Constellation is also pursuing a license renewal to extend plant operations until at least 2054.