in this aerial view, the shuttered Three Mile Island nuclear
in this aerial view, the shuttered Three Mile Island nuclear power plant stands in the middle of the Susquehanna River on October 10, 2024 near Middletown, Pennsylvania. The plant’s owner, Constellation Energy, plans to spend $1.6 billion to refurbish the reactor that it closed five years ago and restart it by 2028 after Microsoft recently agreed to buy as much electricity as the plant can produce for the next 20 years to power its growing fleet of data centers. The shuttered plant is the site of the worst nuclear reactor accident in United States history when one of the plant’s two reactors melted down in 1979.

Constellation Energy’s plan to reconnect Unit 1 of the Three Mile Island nuclear plant in Pennsylvania to the US power grid has been pushed back from 2027 to 2031. The company’s executives said at the CERAWeek conference in March that grid operator PJM had informed them that upgrades to the transmission lines would not be completed until 2031, Reuters reported.

Three Mile Island Unit 1 has a generating capacity of about 835 megawatts and was shut down in 2019 after years of losses. In September 2024, Constellation signed a 20-year power purchase agreement with Microsoft, under which Microsoft will buy electricity from the unit to support its artificial intelligence and cloud businesses. The plant will be renamed the Crane Clean Energy Center. Constellation plans to invest about US$1.6 billion (about HK$12.5 billion) to refurbish the turbine, generator, main transformer, and cooling and control systems. The unit was initially due to restart in 2028 when the agreement was signed, before the target was brought forward to 2027. The financial terms of the agreement have not been disclosed.

The deal comes as AI data centres consume rapidly increasing amounts of electricity, while wind and solar power are weather-dependent and may struggle to provide uninterrupted supply. Nuclear power, which can provide zero-carbon electricity around the clock, has become an option for technology companies. Microsoft has said, however, that the purpose of the agreement is to offset electricity consumed by its data centres in the PJM grid region, rather than to build the data centres next to the plant.

Unit 1 is separate from Unit 2, where a partial meltdown occurred in 1979. Unit 2 is owned by another company and is being decommissioned. The restart of Unit 1 still requires approval from the US Nuclear Regulatory Commission, as well as state and local authorities.

The delay highlights how power bottlenecks in the AI era may not necessarily be at the generation end, but could instead lie in the transmission network. Issues to watch include the progress of PJM’s transmission projects, the NRC approval process and Constellation Energy’s disclosures on capital spending.