Microsoft on Friday announced a groundbreaking agreement with utility Constellation to purchase nuclear power for its data centers in the Northeast and Mid-Atlantic, enabling the restart of a reactor at the famous Three Mile Island nuclear power plant in Pennsylvania.

The 20-year contract is estimated to deliver 835 megawatts of carbon-free energy to the grid, company officials said. Microsoft will need that power to meet the increasing electricity demand of the data centers that are driving the AI ​​boom.

Despite ambitious targets by major tech companies to reduce emissions that fuel climate change, companies at the forefront of AI development like Microsoft and Google have reported sharp increases in carbon emissions. Microsoft’s latest sustainability report showed that total emissions for 2023 increased by 29 percent compared to 2020.

In a press release about the energy agreement, Bobby Hollis, vice president of energy at Microsoft, called it a “significant milestone” in the company’s efforts to become carbon negative.

“Microsoft continues to work with utilities to develop carbon-free energy sources that help meet grid capacity and reliability needs,” Hollis said.
The agreement also reflects changing attitudes towards the environmental impacts of nuclear energy.

Three Mile Island on the Susquehanna River near Harrisburg, Pennsylvania, was the scene of the “worst accident in the history of commercial nuclear power plant operations in the United States,” according to the U.S. Nuclear Regulatory Commission.

In March 1979, a partial meltdown occurred in reactor unit 2 of the plant, releasing small amounts of radioactive material. Although the incident had little impact on public health and the environment, it raised alarm about potential health and safety implications and sparked an environmental movement against nuclear power.

Today, however, many environmentalists and climate scientists recognize the urgent need to use all forms of carbon-free energy to rapidly transition away from fossil fuels. Reopening part of the Three Mile Island plant would add more clean energy to the national grid and would be a powerful symbol of nuclear power’s comeback.

In a statement on the agreement with Microsoft, Constellation officials said that Three Mile Island’s Unit 1 had been “operating with industry-leading levels of safety” for several decades before being shut down for economic reasons five years ago.

But soaring power demand for data centers, new manufacturing facilities, and the electrification of vehicles and household appliances is changing the economic outlook, and Constellation is one of several utilities looking to restart nuclear power or build new capacity.

“Powering industries critical to our nation’s global economic and technological competitiveness, including data centers, requires an abundance of energy that is carbon-free and reliable 24/7,” Joe Dominguez, Constellation’s president and CEO, said in the statement.

Unit 1 on Three Mile Island, which was not affected by the Unit 2 accident in 1979, is to become the Crane Clean Energy Center. Constellation expects the facility to be operational by 2028 and generate enough electricity to power 800,000 average homes.

According to an economic impact study, reopening the plant will create more than 3,000 jobs and generate $3 billion in state and federal taxes.

In March, the Biden administration announced a $1.5 billion loan guarantee to help restart the idle Palisades nuclear power plant in Michigan. This is part of the White House’s broader initiative to add more nuclear capacity and clean energy to the nation’s energy mix.