Three Mile Island nuclear plant gears up for Big Tech reboot





The Three Mile Island Nuclear power plant is seen at sunset in Middletown, Pennsylvania

Tue, October 22, 2024 
By Laila Kearney

THREE MILE ISLAND, Pennsylvania (Reuters) - Giant cooling towers at Constellation Energy's Three Mile Island nuclear plant in Pennsylvania have sat dormant for so long that grass has sprung up in the towers' hollowed-out bases and wildlife roam inside.

Armed guard stations at an entrance to the shut concrete facility, surrounded by barbed wire, sit empty. The plant, which would run so loud when operating that workers were required to wear hearing protection, is nearly silent.

"It's still eerie walking in here and it's, just, quiet," Constellation regulatory assurance manager Craig Smith said during a tour of the plant last week. Smith, who worked at Three Mile Island when Constellation shut the site’s remaining reactor in 2019, is now preparing for a restart.

Constellation announced last month that it would revive the half-century-old Three Mile Island with the purpose of fueling Microsoft's data centers. Microsoft is expected to pay at least $100 a megawatt-hour, nearly double the typical cost of renewable energy in the region, as part of the 20-year power contract.

The agreement shows the dramatic lengths Big Tech is willing to go to procure electricity for its artificial intelligence expansion and the undertaking by the U.S. power industry to meet that demand.

The effort to restore Unit 1 at Three Mile Island is expected to take four years, at least $1.6 billion, and thousands of workers to complete the unprecedented task of restarting a retired nuclear plant.


Constellation has already ordered costly equipment for the site and identified fuel for the unit's reactor core, with work expected to start early next year, according to Reuters' interviews with company executives, contractors and a tour of the site.

Successfully resurrecting Three Mile Island, which is widely known for a 1979 partial meltdown that cast a pall over the U.S. nuclear sector for decades, would put the plant at the front edge of an industry revival.

Nuclear creates large amounts of carbon-free electricity. That is attractive to companies, like Microsoft, that have climate pledges and face increasing public scrutiny for their voracious power use.

Microsoft would consider signing other power purchase agreements to restart shut plants, Alistair Speirs, senior director of Microsoft's Azure Global Infrastructure, told Reuters.

"I don't think anything's off the table," Speirs said.

Relaunching Three Mile Island would supply to the regional grid 835 megawatts of electricity - enough for all of Philadelphia's homes - to help offset Microsoft's power consumption.



A restart of the plant, however, is not certain. Three Mile Island, which will be renamed the Crane Clean Energy Complex, still requires licensing modifications and permitting. Local activists have also vowed to fight the project over safety and environmental concerns.

If the plan suffers the same lengthy delays and cost overruns that have plagued nearly every nuclear build in the country's history, it could stymie other deals and set back Big Tech's quest to rapidly expand, power experts say.

MILLIONS OF FEET OF BUILDING

Earlier this year, Constellation finished initial testing of the plant's Unit 1 to determine whether it was financially reasonable to resurrect it.

After learning that the central generator, which would cost hundreds of millions of dollars to replace, was in strong condition, the company moved ahead with its plan.

“We have a perfectly ready-to-go main generator just waiting for the rest of the plant to get started,” said Smith, standing in front of a row of massive turbines.


About a thousand carpenters, electricians, pipefitters and other tradesmen are expected to be deployed to the site, said Rob Bair, president of Pennsylvania Building Trades.

Work will likely start in the first quarter of 2025 with restoring two 370-foot (113-m) high cooling towers, which were stripped bare after the plant shut.

"There is a ton of equipment that has to go back in those towers," said Bair, whose father helped build Unit 1, which opened in 1974.

Workers will be hoisted up the top of the towers to install lighting and restock the buildings from within. The structures' bases, which were once made of redwood, will be refurbished with modern materials.

Next, restorations inside of the plant will begin: some major equipment will be replaced. Constellation recently ordered the site's main transformer, which is expected to cost around $100 million including installation, to be delivered in 2027.

Piping and electrical work, scrubbing condensers and cleaning out power generators, will be among the next tasks. A million-gallon tank will be filled with water.


Much of the analogue control room, with a panel installed in the early 1970s, will stay the same. A benefit of keeping the analogue system is that it would be more secure against cyberattacks, officials said.

Completing the job will require several million feet of scaffolding, built by scaffologists, or carpenters with special licenses, to be assembled repeatedly around the island.

"And all of that has to be done before you can even put fuel on the site," Bair said.

The company has commissioned the fuel design for the reactor's core, said Constellation Chief Generation Officer Bryan Hanson. The core holds the enriched uranium, the fuel source for the plant, stacked in pellets and sealed in tubes.

Constellation, which is the biggest U.S. operator of nuclear plants, will tap into fuel from its existing enriched uranium reserves as one of the final steps before starting up.

The effort is part of a recent turnaround of U.S. nuclear power, which suffered from competition from cheap fuel and fears of meltdowns, said John Ciampaglia, CEO of Sprott Asset Management, which manages a large physical uranium fund.


In Michigan, Holtec is in the process of trying to restart another reactor site.

Constellation's stock price has soared by 135% so far this year amid fresh projections for record U.S. power consumption next year and a doubling of data center demand by 2030.

Not everyone is enthused about the prospect of a nuclear comeback. The power plants produce waste that can remain radioactive for thousands of years.

About a tennis court-size amount of spent nuclear fuel from Unit 1 is stored on Three Mile Island, which sits on a strip of land in the Susquehanna River. The decommissioning of Unit 2 is still underway about 45 years after the partial meltdown.

Local activist Eric Epstein, who remembers the March 1979 incident, said he will fight Constellation's request to resume operating and water use licenses.

"It's going to be a protracted battle," Epstein said.

The first chance for the challenges comes on Oct. 25, when the Nuclear Regulatory Commission has scheduled its initial public hearing on Constellation's plan to restart Unit 1.

(Reporting by Laila Kearney; Editing by Marguerita Choy)


AI's surge is sparking demand for an unexpected GE Vernova product

Rob Lenihan
Mon, October 21, 2024 at 5:15 PM MDT 5 min read

If you're excited about the growth of artificial intelligence, we have some electrifying news for you.

AI takes up a good chunk of the world’s energy — and it will be using even more in the coming years.

The average ChatGPT query consumes nearly 10 times as much electricity to process as a Google search and Goldman Sachs Research estimated in a May study that data center power demand will grow 160% by 2030.

Currently data centers worldwide consume 1% to 2% of overall power, but this percentage will likely rise to 3% to 4% by the end of the decade, the firm said.

"In the US and Europe, this increased demand will help drive the kind of electricity growth that hasn’t been seen in a generation," the Goldman study said.

Data center workloads nearly tripled between 2015 and 2019, but the demand for power remained relatively flat at about 200 terawatt-hours per year, Goldman said, as these facilities kept growing more efficient in how they used the power they drew.

But since 2020, the efficiency gains appear to have dwindled, and the power consumed by data centers has risen.
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nalysts are issuing research reports for GE Vernova
SOPA Images/Getty Images

GE Vernova 'adding gigawatts of nuclear energy'

"Some AI innovations will boost computing speed faster than they ramp up their electricity use, but the widening use of AI will still imply an increase in the technology’s consumption of power," the report said.

Nuclear energy is being suggested as a way to meet the tech power demand.

Related: Nvidia stock hits record high as key AI player smashes Q3 earnings

Small modular reactors (SMRs) can generate up to roughly one-third the amount of power of a traditional reactor, and developers say they can be built faster and at lower cost than large power reactors.


On Oct. 16, the U.S. Department of Energy opened applications for up to $900 million in funding to support the deployment of small nuclear reactors.

“Revitalizing America’s nuclear sector is key to adding more carbon-free energy to the grid and meeting the needs of our growing economy—from AI and data centers to manufacturing and healthcare,” U.S. Energy Secretary Jennifer Granholm said in a statement.

Some of the biggest names in the tech sector, including Amazon (AMZN) , Alphabet's (GOOGL) Google, and Microsoft (MSFT) , have all recently announced agreements with nuclear energy companies.

Scott Strazik believes his company can play a role in the brave nuclear world.

Strazik is CEO of GE Vernova (GEV) , one of three companies spun off from General Electric, a list that also includes GE HealthCare and GE Aerospace.


GE Vernova, which started trading as a stand-alone company in April, focuses on electrification and carbonization.

"I do think in the early 2030s this will start to scale," CEO Scott Strazik told the Wall Street Journal last month. "We’re going to be adding gigawatts upon gigawatts of nuclear capacity every year. So it’s going to take this decade to really validate the technology, get a few of the first projects cut into COD, or commercial operation date."


"And I’m highly confident in the 2030s this is going to be a very material part of the equation for us," he added.

GE Vernova's nuclear business, GE Hitachi Nuclear Energy, signed a series of Memorandum of Understanding (MoUs) in September to support the delivery of its SMR technology in the United Kingdom.

Investment firms have been issuing research notes recently for GE Vernova.

Bank of America Securities said on Oct. 20 that, based on over 60 years of experience in nuclear power, GE Vernova has developed an SMR, the BWRX-300, that has won its first contract and has a pipeline of 28 units in various stages of regulatory approval, according to The Fly.

B of A, which said that it sees a "big opportunity in small reactors" for GE Vernova and called recent headlines about more nuclear investment "a positive" for the company.
Analyst: GE Vernova 'global leader in electric power'

The firm maintained its buy rating and $300 price target on the shares.

Deutsche Bank analyst Nicole DeBlase initiated coverage of GE Vernova with a buy rating and $354 price target.

GE Vernova is a global leader in the electric power industry, providing products and services that generate, transfer, orchestrate, convert, and store electricity, the analyst said.

DeBlase said the company is a pure play on global investment in power generating capacity, and the outlook for power investment "is stronger than it has been in decades."

She projected a 63% adjusted EBITDA annual growth through 2027 for GE Vernova.

On Oct. 18, RBC Capital analyst Christopher Dendrinos raised the firm's price target on GE Vernova to $262 from $246 and kept an outperform rating on the shares as part of a broader research note previewing third quarter results in the U.S. Clean Energy sector.

The current dynamics — including the election cycle, elevated current but expected lower future interest rates, changing trade policies and competitive environments — have produced mixed results, and the investor sentiment “remains bearish” on the space, the analyst said.

Dendrinos also sees limited upside opportunity ahead of the November election and risk that is “largely to the downside” heading into earnings, amid limited cash generation, upside due to competition among solar installers and project delays for utility scale operators.

Offsetting the negatives, however could be the company's strong Power and Electrification performance and gas turbine orders that could be up significantly and will drive shares higher, Dendrinos said.

Not everyone is on board with small nuclear reactors.

A 2022 study by Stanford University and the University of British Columbia said that “small modular reactors, long touted as the future of nuclear energy, will actually generate more radioactive waste than conventional nuclear power plants.”

“Our results show that most small modular reactor designs will actually increase the volume of nuclear waste in need of management and disposal, by factors of 2 to 30 for the reactors in our case study,” said the study's lead author Lindsay Krall.

"“These findings stand in sharp contrast to the cost and waste reduction benefits that advocates have claimed for advanced nuclear technologies," she added.