Business News -- October 18, 2026: Technology-company power contracts and billions in federal financing are helping revive retired reactors, bringing renewed scrutiny to safety, public costs, grid capacity and water supplies.
Microsoft’s and Google’s demand for electricity to support their data-center businesses is driving restart agreements at Three Mile Island Unit 1 in Pennsylvania and Duane Arnold in Iowa. Their long-term power contracts are helping make reopening the retired reactors financially viable, alongside federal financing.
The agreements connect private companies’ computing expansion with decisions about public financing and electricity infrastructure. They arrive after decades in which new nuclear construction was rare and some existing reactors closed because their electricity was no longer economically competitive.
Palisades in Michigan is also pursuing a restart with government support. Its electricity, however, is contracted to electric cooperatives rather than directly to Microsoft or Google. The three projects have different customers and development histories.
Decades of limited construction—and a change in demand
New nuclear development slowed sharply beginning in the late 1970s. The Energy Information Administration identifies slowing electricity-demand growth, high construction costs, financial risk and public opposition among the reasons. The 1979 Three Mile Island accident further affected costs, schedules and public acceptance.
Only three new commercial nuclear reactors entered service in the United States after 1996: Watts Bar Unit 2 in Tennessee in 2016, and Vogtle Units 3 and 4 in Georgia in 2023 and 2024. These were exceptions to a prolonged period of little new nuclear construction
Electricity-demand growth was also modest for an extended period. EIA reports that U.S. demand grew an average of approximately 0.1% annually between 2005 and 2019, compared with about 1.7% annually between 2020 and 2025. The agency identifies data-center electricity use as a driver of the newer growth.
That change helps explain the renewed commercial interest. Microsoft’s and Google’s commitments to purchase electricity over decades are supporting the return of plants previously retired under different market conditions.
Three Mile Island: a different reactor from the 1979 accident
Three Mile Island Unit 1 closed in September 2019 for economic reasons. Constellation plans to return it to service as the Crane Clean Energy Center under a 20-year power purchase agreement with Microsoft. The company identifies 2027 as its expected return-to-service year, subject to completing the restart process.
Unit 1 is not the reactor that suffered the 1979 partial meltdown.
That accident occurred in Unit 2 on March 28, 1979. Equipment failures, design problems and operator actions contributed to the event. The Nuclear Regulatory Commission describes it as the most serious accident in U.S. commercial nuclear power history and says the small radioactive releases had no detectable health effects on workers or the public.
The accident prompted major changes in regulation and operations. Unit 1 continued operating for decades afterward. Its proposed restart is now subject to a site-specific NRC inspection and oversight process.
Duane Arnold: retirement once promised customer savings
In 2018, NextEra Energy and Alliant Energy announced an agreement shortening Duane Arnold’s existing power contract and planning retirement in late 2020. They projected that Alliant customers would save nearly $300 million over 21 years, measured on a net present value basis.
The Iowa plant stopped generating electricity in August 2020 after damage from a powerful derecho. NextEra and Google subsequently announced a 25-year power agreement supporting its restart, with operations targeted for early 2029.
A facility whose retirement was presented as a customer savings measure is therefore being restored under a different commercial arrangement.
Palisades follows a different path
Palisades stopped operating in May 2022 and was sold to Holtec for decommissioning. Michigan officials supported efforts to reopen it, and its electricity is contracted to Wolverine Power Cooperative and Hoosier Energy.
Its revival belongs in the broader nuclear restart story, but should not be attributed to a Microsoft or Google electricity agreement.
Public money extends beyond electricity bills
The Department of Energy has closed financing of up to $1.52 billion for Palisades, $1 billion for the Crane restart and $1.9 billion for Duane Arnold—approximately $4.42 billion combined. These amounts represent financing commitments, not necessarily money fully disbursed or taxpayer losses.
Federal loans must be repaid. They differ from grants, although the government faces potential losses if borrowers fail to repay.
Palisades also has other documented public support. Michigan announced $300 million in state funding for reopening activities, including infrastructure, fuel and workforce development. In September 2024, the governor’s office also announced more than $1.3 billion in USDA awards supporting restoration of service and lower electricity costs, including a grant exceeding $650 million for Wolverine Power Cooperative. These commitments are separate from DOE’s restart financing.
Those distinctions matter: repayable lending, grants and state spending create different financial obligations. They should not be combined and described as money taxpayers have already lost.
An existing grid investment need—and additional demand
The nation’s power grid already requires investment to maintain reliability, relieve congestion and connect electricity supplies with customers. Data-center expansion adds large new electricity loads to those existing infrastructure needs. DOE identifies hyperscale AI data centers among the drivers of additional transmission requirements.
Restarting nuclear reactors adds generating capacity, but does not automatically provide the transmission lines and substations needed to deliver that electricity. Accommodating data-center demand may require separate grid investments alongside spending to restore the plants.
Responsibility for additional grid costs depends on utility agreements and regulatory decisions. EIA has documented concerns that some arrangements connecting data centers directly with nuclear generation could allow them to avoid fees supporting the wider grid, potentially shifting costs to other customers. That outcome requires examination project by project.
Grid improvements can also increase access to existing generation. DOE identifies technologies that expand the capacity of current transmission lines as options for moving more electricity and reducing some additional infrastructure needs. Grid investment and generating investment address different parts of the electricity system.
Experts dispute safety and financial assumptions
Edwin Lyman, a physicist and director of nuclear power safety at the Union of Concerned Scientists, has questioned the technical and financial uncertainties surrounding technology-company nuclear agreements. In a 2024 statement, he warned that unsuccessful projects could ultimately create financial demands on taxpayers and utility customers. His warning is an assessment from a science advocacy organization, not a finding that those losses have occurred.
At Palisades, Lyman has raised a specific objection to repairing aging steam generators rather than replacing them. In a May 2026 WMUK interview, he argued that replacement would be the safest approach.
The same report included responses from Holtec and University of Michigan nuclear engineering professor emeritus John Lee. Holtec said its repairs were safe and subject to NRC oversight. Lee supported the restart and the refurbishment approach, while emphasizing that the equipment must satisfy NRC inspectors.
Supporters also emphasize nuclear generation’s steady output and low operational carbon emissions. DOE identifies restarting retired facilities as a potential way to add electricity without constructing an entirely new plant. These benefits form part of the energy and economic case; safety authorization remains a separate requirement.
Radioactive waste remains an unresolved obligation
The United States still lacks a permanent disposal facility for commercial spent nuclear fuel. The Government Accountability Office reports that spent fuel continues accumulating at nuclear plant sites while the federal government remains responsible for developing permanent disposal.
The government has paid reactor owners compensation for failing to meet its commitment to accept that fuel. Those public expenses predate the current technology-company agreements and are separate from electricity bills. Continued reactor operation produces additional spent fuel requiring management.
New reactors: announced locations, uncertain final scale
Technology-company nuclear plans extend beyond restarting existing plants.
Kairos Power identifies Oak Ridge, Tennessee, as the location of its planned Hermes 2 plant. Under an agreement with the Tennessee Valley Authority, its electricity would enter the regional grid serving Google data centers in Tennessee and Alabama.
Amazon describes a planned facility in Richland, Washington, involving Energy Northwest and X-energy, with up to 12 reactor modules. The company identifies the early 2030s as the project’s intended timeframe.
Some proposed sites and reactor counts are known. The eventual number built and the full geographic footprint remain uncertain. Announced projects and company schedules do not establish that every reactor will secure financing, receive necessary approvals or enter operation.
Water supplies will influence future locations
Conventional nuclear generation generally requires substantial cooling water. Cooling systems differ: some withdraw water and return it warmer, while others recirculate water through cooling towers and lose water through evaporation. NRC environmental reviews identify potential effects on aquatic life, water temperature and competing water uses, depending on the location and design
Drought resilience and cooling performance also matter. Air cooling can reduce water requirements, but involves engineering and performance tradeoffs. A proposed plant’s water requirements must therefore be assessed individually rather than inferred from its size or designation as an advanced reactor
At Three Mile Island Unit 1 and Duane Arnold, technology companies’ business demand is helping drive the return of retired nuclear generation. The associated commitments extend beyond electricity purchases to government financing, grid infrastructure, safety oversight and long-term waste management.
Sources
U.S. Department of Energy — restart financing, transmission needs and cooling technologies.
U.S. Energy Information Administration — nuclear construction history, electricity-demand growth and grid-cost concerns.
U.S. Nuclear Regulatory Commission — Three Mile Island accident history, restart oversight and environmental reviews.
U.S. Government Accountability Office — nuclear waste disposal and federal compensation obligations.
Michigan Governor’s Office — state funding and federal awards supporting Palisades.
Constellation Energy — Microsoft agreement and Three Mile Island Unit 1 restart plans.
NextEra Energy — Google agreement, Duane Arnold restart plans and earlier retirement announcement.
Entergy — Palisades closure and sale.
Wolverine Power Cooperative — Palisades electricity-purchase agreement.
Union of Concerned Scientists — Edwin Lyman’s safety and financial assessments.
WMUK public radio — interviews with Edwin Lyman, John Lee and Holtec regarding Palisades.
Kairos Power — proposed Oak Ridge project and Google–TVA arrangement.
Amazon — proposed advanced reactor development in Richland, Washington.