Energy Department loans $1B to help finance the restart of nuclear reactor on Three Mile Island

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HARRISBURG, Pa. (AP) — The U.S. Department of Energy said Tuesday that it will loan $1 billion to help finance the restart of the nuclear power plant on Pennsylvania's Three Mile Island that is under contract to supply power to data centers for tech giant Microsoft.

The loan is in line with the priorities of President Donald Trump's administration, including bolstering nuclear power and artificial intelligence.

For Constellation Energy, which owns Three Mile Island's lone functioning nuclear power reactor, the federal loan will lower its financing cost to get the mothballed plant up and running again. The 835-megawatt reactor can power the equivalent of approximately 800,000 homes, the Department of Energy said.

The reactor had been out of operation for five years when Constellation Energy announced last year that it would spend $1.6 billion to restart it under a 20-year agreement with Microsoft to buy the power for its data centers.

Constellation Energy renamed the functioning unit the Crane Clean Energy Center as it works to restore equipment including the turbine, generator, main power transformer and cooling and control systems. It hopes to bring the plant back online in 2027.

The loan is being issued under an existing $250 billion energy infrastructure program initially authorized by Congress in 2022. Neither the department nor Constellation released terms of the loan.

The plant, on an island in the Susquehanna River just outside Harrisburg, was the site of the nation’s worst commercial nuclear power accident, in 1979. The accident destroyed one reactor, Unit 2, and left the plant with one functioning reactor, Unit 1.

In 2019, Constellation Energy's then-parent company Exelon shut down the functioning reactor, saying it was losing money and Pennsylvania lawmakers had refused to subsidize it to keep it running.

The plan to restart the reactor comes amid something of a renaissance for nuclear power, as policymakers are increasingly looking to it to shore up the nation's power supply, help avoid the worst effects of climate change and meet rising power demand driven by data centers.

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Follow Marc Levy at http://twitter.com/timelywriter.