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BREAKING: BLOCKBUSTER MICROSOFT DATACENTER DEAL RESURRECTING THREE MILE ISLAND NUCLEAR PLANT

Microsoft and nuclear plant owner Constellation have agreed to a massive, unprecedented deal to restart the closed Three Mile Island by 2028 to power its datacenters, per the New York Times.

The deal? Microsoft purchasing as much power as possible from its 880 MW reactor over 20 years for prices rumored to be above $100 per MWh.

Most famous for its 1979 meltdown of reactor 2, TMI unit 1 closed in 2019 because of cheap fossil fuels and tech companies refusing at the time to consider buying its electricity to meet clean energy goals.

nytimes.com/2024/09/20/climate

The New York Times · Three Mile Island Plans to Reopen as Demand for Nuclear Power GrowsBy Brad Plumer
Emil Jacobs - Collectifission

Commentary by Mark Nelson:

Clearly, the biggest tech companies are desperate to buy up nuclear plants. This deal between Microsoft and Constellation represents the biggest and richest of its kind. It won't be the last.

Constellation needed to be sure it would recover the estimated $1.8 billion required to restore the closed plant to long-term operation, and this deal with Microsoft is extraordinary for the expected contract length and price being paid for TMI's constant clean power.

I suspect Microsoft is paying a big premium to get this plant back as fast as possible.

This deal is revealing such interesting things about the limits of getting concentrated power from new renewables.

TMI nuclear power is being purchased for a price that appears to be multiples of what new wind and solar projects can get, demonstrating the high value of nuclear electricity and the low value of incorrectly located and erratically produced power.

Electricity is not, and never was, a commodity. It is a service with strict and uncompromising location and time-based constraints. Nuclear almost perfectly matches the specific service needs of the next generation of centralized AI datacenters in a way distributed weather-based energy cannot do while keeping costs reasonable.

Getting electricity to market when and where needed is a savage problem. The amount of constant power needed at individual hyperscale datacenters is unprecedented. Combine these two things and nuclear power from existing plants becomes extremely valuable because it's both constant and carbon-free.

Breaking down the numbers:

Today's operating nuclear plants make electricity for a cost to owners of $20-40 per MWh.

Today's electricity markets have been paying nuclear plants $30-60 per MWh.

Hyperscalers are willing to pay over $100 per MWh, on seemingly unlimited volume, if they can get it.

New renewables are being built for $40-100 per MWh, but their power is in the wrong spots at the wrong time, and thus does not solve the problem of constant power for datacenters.

It would've been much better to have kept Three Mile Island going, perhaps with a long-term deal by the State of Pennsylvania similar to the short-term deals Illinois used to save its Chicago-area plants in 2021.

Now the Three Mile Island is returning from the dead and Microsoft is going to get it all, for decades.

@collectifission Let them finish restarting it, then ban AI. Two problems solved ^_^J