The administration of U.S. President Donald Trump has decided to provide $1 billion in loan funds to Constellation Energy. This funding will be directed towards restarting one of the reactors at the Three Mile Island nuclear power plant. The energy company confirmed its intentions to resume operations of the reactor, which was shut down in 2019, after Microsoft agreed to a long-term agreement to purchase all electricity from this power plant, with a capacity of 835 megawatts, for a period of 20 years. The total cost of the project is estimated to be around $1.6 billion, with completion scheduled for 2028.
Details of the agreement between Microsoft and Constellation have not been disclosed. Analysts at Jefferies suggest that the cost per megawatt-hour for the tech giant could range from $110 to $115 throughout the duration of the contract. According to Lazard, this is more economical compared to building a new nuclear power plant, although it is significantly more expensive than alternative energy sources such as wind, solar, and geothermal resources. Even projects utilizing wind and solar installations with industrial batteries that provide round-the-clock power supply are proving to be more cost-effective.
Nevertheless, interest from major tech companies in nuclear energy has significantly increased in recent years. This is due to the growing electricity demands for data centers and artificial intelligence projects. This summer, Meta* signed an agreement with Constellation to purchase "clean energy attributes" from a nuclear power plant in Illinois with a capacity of 1.1 gigawatts.
It should be noted that the restart of the reactor at Three Mile Island pertains to Unit 1, which began operations in 1974 and was closed in 2019 due to declining profitability caused by low natural gas prices, and not the accident-prone Unit 2, which experienced a disaster in 1979.
