Microsoft and Constellation Energy announced a groundbreaking deal to reopen the partially melted-down Three Mile Island nuclear plant, with the tech giant purchasing all the power for 20 years after the restart.

The deal marked the first time a decommissioned US nuclear plant had been brought back into service and the first time a commercial nuclear power plant’s entire output had been allocated to one customer, Xinhua news agency reported.

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The agreement aimed to feed the growing energy needs of Microsoft’s artificial intelligence (AI) operations while restarting the infamous Pennsylvania facility, the site of the worst nuclear accident in US history.

Constellation Energy, the plant’s owner, planned to restart Three Mile Island Unit 1 by 2028 at a cost of about $1.6 billion. The unit sits adjacent to the reactor that suffered a partial meltdown in 1979, an event that sent the nation into panic and dealt a severe blow to the nuclear industry.

“The nuclear power plant never should have been allowed to shut down,” said Joseph Dominguez, chief executive of Constellation, in a press release. He added that the nuclear plant would produce as much clean energy as all the renewables built in Pennsylvania over the last 30 years.

The restarted facility would provide Microsoft with 835 megawatts of electricity, equivalent to powering about 800,000 homes.

According to the US Nuclear Regulatory Commission, on March 28, 1979, the Unit 2 reactor core at the Three Mile Island plant partially melted down when equipment malfunctions, compounded by human operator errors, caused a water pump failure that resulted in a loss of coolant to the reactor.

The partial meltdown led to the release of radioactive gases and iodine into the environment, though no deaths or injuries were directly linked to the incident. Unit 2 remains sealed, with its highly radioactive core encased in concrete.

The revival of Three Mile Island is part of a broader trend of tech companies seeking reliable, zero-emissions power sources to support their expanding data centres and AI technologies.

However, Microsoft’s plan has faced significant regulatory hurdles and public scepticism. Constellation must clear intensive safety inspections from the U.S. Nuclear Regulatory Commission, which has never before authorized the reopening of a nuclear plant. The company expects the review process to be completed by 2027.

The deal also raised questions about the use of federal subsidies, as the project relies heavily on tax breaks earmarked for nuclear power in the 2022 Inflation Reduction Act. Critics argued that using public funds to benefit a single private company may be inappropriate.

Social media reactions to the news were mixed.

One Washington Post’s website commenter sarcastically suggested, “OK, as long as the waste is sent to Microsoft HQ in Redmond, WA.”

Another user on The Verge expressed concerns about the broader implications: “The potential power demand is looking to be so large — it will delay the transition to carbon-free energy (here in the US) and not by a little bit… Seems like a law saying all electricity for AI and Crypto farms in the US has to be carbon-free is in order.”

Some community leaders welcomed the potential economic revival, with a study funded by the Pennsylvania Building and Construction Trades Council projecting the creation of 3,400 jobs and $3 billion in state and federal taxes.

Pennsylvania Governor Josh Shapiro expressed support, saying that the plant will “safely utilise existing infrastructure to sustain and expand nuclear power in the Commonwealth while creating thousands of energy jobs,” said a Constellation press release.

However, nuclear safety advocates have expressed alarm.

Henry Sokolski, a former deputy for nonproliferation policy at the Pentagon, criticised the use of public subsidies, telling the Washington Post, “Microsoft says it will buy all of the nuclear electricity from Three Mile Island, but it wants rate and taxpayers to pick up the tab to refurbish the plant.”