When one of the two reactors at the Three Mile Island nuclear power plant in Pennsylvania failed in April 1979, Time magazine cried out ‘nuclear nightmare’. At that time, all people within a five-mile radius were evacuated due to a radioactive gas leak. Fortunately, no one was injured.
Twenty years later, The Economist published the pleasant fact that the plant’s second reactor had been operating continuously for all these years with a high level of safety and enjoyed local support. But it was eventually shut down in 2019 due to competition from cheap shale gas.
Now Three Mile Island is coming back to life. On 20 September, Microsoft and the American energy company Constellation Energy Corporation signed an agreement to bring the Unit1 reactor back into operation.
This will add about 835 megawatts of carbon-free energy to the grid, create about 3,400 jobs, and provide payments of about $110-115 per megawatt-hour. It is planned to spend around $1.6 billion on the restoration until 2028, after which Microsoft will purchase its carbon-free electricity for 20 years. This is a big step towards securing reliable and clean energy for Microsoft’s needs, especially for their data centres, which require a large amount of energy.
The scale of nuclear power in the world
History develops in cycles. After a decline in the 1990s and 2000s, the share of global nuclear energy generated by new nuclear power plants is now growing again. America is home to 94 conventional nuclear reactors, a fifth of the world’s total. Despite this, it has built few in recent decades. At the same time, more than five dozen nuclear reactors are under construction around the world. In July, for example, the Czech Republic finalised plans for a $17 billion nuclear project.
And there is growing interest in small modular reactors (SMRs), which are cheaper and faster to build. SMRs are a type of nuclear reactor that are smaller than traditional reactors and can be built in a modular fashion, meaning they can be easily transported, assembled and deployed on site.
Due to their smaller size and modularity, SMRs have several advantages: they are easier to integrate into different power systems, use new technologies that reduce accident risks, and can be built and commissioned faster. Small modular reactors can become an important part of the energy future, providing clean and stable electricity even in remote or hard-to-reach regions.
How big technologies are bringing nuclear power back to life
The nuclear renaissance is being accelerated by demand from tech giants such as Microsoft, Amazon and Google. After all, they need a lot of clean energy to power their data centres, which is at the heart of the artificial intelligence boom. Microsoft’s president attributes this to the company’s ambitious promise, made even before the advent of AI, to remove more greenhouse gases from the atmosphere than it has contributed in its entire history. Now this dream seems even more ambitious, as now, thanks to the development of artificial intelligence, Microsoft will have time to consume 5-6 times more electricity by 2030 than previously expected.
Nuclear power is well suited to data centres because it provides a reliable source of clean energy around the clock, unlike wind and solar. Nuclear power plants are also attractive because of their enormous scale: an AI data centre can require up to a gigawatt of power to run. For comparison, a single nuclear power plant can provide power on par with millions of solar panels.
Unfortunately, there are only a few decommissioned nuclear reactors in America, Europe, and Japan that are suitable for revival. Therefore, new plants will have to be built. These projects require large investments and are sensitive to stock market fluctuations and long delays. In addition, the risk of project cost overruns is currently higher, as the supply chains and expertise required to build nuclear power have atrophied. An example of this is the recently opened Vogtle nuclear power plant in Georgia, the first in America in decades. The project cost $35 billion, which is twice the original estimate, and the plant was commissioned 7 years later than planned.
External investment as a way to reduce project risk
In tandem with BlackRock, an asset management company, and other investors, Microsoft has launched a $30 billion infrastructure fund dedicated to AI. The president of Microsoft claims that the fund’s capacity could grow to $100 billion and that it will, among other things, finance nuclear projects. He also expects 3-4 similar funds to emerge under the auspices of other tech corporations, and suggests that Microsoft will be involved in all of them.
At the same time, tech giants are interested in building small modular reactors. Western power equipment manufacturers such as GE Vernova and Rolls Royce are actively developing their models. In August, TerraPower, an SMR startup backed by Bill Gates, broke ground on its first plant in Wyoming.
Another startup, Oklo, one of whose sponsors is Sam Altman, CEO of OpenAI, intends to deploy several small nuclear power plants by 2030. This year, it signed a deal to provide data centre operator Equinix with 500 megawatts of nuclear power, including an upfront payment to finance construction.
Thanks to the enthusiasm of the tech industry, America is creating a better environment for small modular reactor construction than anywhere else in the world. Recently, Oracle, the software giant, unveiled plans for a data centre on the scale of George Washington University, which will be powered by three SMRs for which the firm has already received approval. Google’s boss also confirmed that his company is considering small modular reactors to power its data centres.
Why small modular reactor technology does not scale well
The high and uncertain cost of building conventional nuclear power plants will continue to hamper the industry’s development and the hopes of large tech companies for exponential AI development without carbon emissions. The executive director of Southern Company, which owns a nuclear power plant in Georgia, believes in the power of public support for the initiative. ‘The government has to provide some insurance against cost overruns,’ he says. Simplifying lengthy permitting processes would be even better.
After a long period of stagnation, governments are indeed beginning to change their attitudes towards nuclear power. During the UN Climate Week in New York, officials reaffirmed the commitment made by more than 20 countries at the Dubai summit to triple global nuclear power production by 2050. In addition, 14 major banks expressed their readiness to finance nuclear projects.
The Chairman of the Emirates Nuclear Energy Corporation noted the surge in demand, partly due to the development of AI, and stressed the need for technical innovation, financial support and favourable policies to further develop the sector.
Tetiana Morarash
