Constellation Energy Stock Jumps on Plan to Restart Three Mile Island Site With Microsoft

News that Constellation Energy (CEG) plans to bring Pennsylvania’s Three Mile Island out of mothballs to provide “clean” energy for Microsoft (MSFT) sent Constellation’s shares to an all-time high. 

The power utility announced a 20-year agreement with the software giant to create the Crane Clean Energy Center, which involves restarting the Three Mile Island Unit 1 that was shuttered five years ago. The adjacent Unit 2 was shut down in 1979 after a malfunction caused a partial core meltdown, which led to significant changes in the nuclear power industry. Unit 2 is separately owned and is being decommissioned, Constellation said.

The agreement will have Microsoft buying electricity from Unit 1 as part of its effort to help provide carbon-free energy to its data centers on the Pennsylvania-New Jersey-Maryland power transmission system. Financial details were not disclosed.

With today’s gains of about 15%, shares of Constellation Energy have more than doubled this year. Microsoft shares were recently lower as tech stocks retreated following big Thursday gains.

Constellation CEO Joe Dominguez said powering key industrial operations like data centers “requires an abundance of energy that is carbon free and reliable every hour of every day, and nuclear plants are the only energy sources that can consistently deliver on that promise.” 

Constellation said it would spend approximately $1.6 billion, including the cost of nuclear fuel, to restart the plant, the reopening of which is scheduled for 2028.

Bobby Hollis, vice president of energy at Microsoft, called the deal “a major milestone in Microsoft’s efforts to help decarbonize the grid in support of our commitment to become carbon negative.”