Big Tech Goes Nuclear to Cover AI Costs – What’s Next?

In September 2024, Microsoft announced a purchase agreement with Constellation, the owner of Three Mile Island Core 1. The agreement will restart an 835-megawatt (MW) nuclear facility in Pennsylvania — Core 1, which was retired in 2019 after operating successfully for over four decades.

In October 2024, Google announced nuclear AI data center plans, and Amazon announced investments in ‘nuclear clean energy’.

However it is Microsoft’s Three Mile Island reactivation project that is attracting controversy.

For many, the reactivation of Three Mile Island raises controversy and the specter of the worst nuclear accident in American history. In March 1979, Core 2 of Three Mile Island near Harrisburg, Pennsylvania, experienced a partial core reactor meltdown due to a “Loss of Coolant Accident” (LOCA).

Microsoft says that the reactivation of Core 1 will be secure, reduce carbon emissions by 61 million tons of CO2 over 20 years, create 3,400 direct and indirect jobs, and deliver more than $3 billion in state and federal taxes.

We explore the various opinions about Microsoft’s plan, the growing trend of privatization of nuclear facilities, and why rising AI energy costs are powering this new phenomenon.

Table of Contents Table of Contents

1. Key Takeaways
2. Why Would Microsoft Risk An Anti-Nuclear Backlash in Pennsylvania?
3. Does AI Need Nuclear Energy? Aren't Solar & Wind Enough?
4. The Domino Effect: When Big Tech Owns Nuclear
5. The Innovation and Technologies that Microsoft, Google, and Amazon Could Bring to the Nuclear Table
6. The Bottom Line
7. FAQs
8. References

Show Full Guide

Table of Contents

1. Key Takeaways
2. Why Would Microsoft Risk An Anti-Nuclear Backlash in Pennsylvania?
3. Does AI Need Nuclear Energy? Aren't Solar & Wind Enough?
Show Full Guide
4. The Domino Effect: When Big Tech Owns Nuclear
5. The Innovation and Technologies that Microsoft, Google, and Amazon Could Bring to the Nuclear Table
6. The Bottom Line
7. FAQs
8. References

Why Would Microsoft Risk An Anti-Nuclear Backlash in Pennsylvania?

As part of the deal, Microsoft will buy all of the energy that the restored nuclear plant produces in an effort to match the power its data centers use with carbon-free energy.

Techopedia spoke to James Walker, a nuclear physicist who led and managed the new Rolls-Royce Nuclear Chemical Plant project, was a U.K. subject matter expert for the U.K. Nuclear Material Recovery Capabilities. Today he is the CEO, Head of Reactor Development and Board Member at NANO Nuclear Energy.

Walker told us:

“Microsoft’s decision to engage in reopening the Three Mile Island nuclear plant likely stems from the increasing energy demands of the tech industry, particularly in areas like AI.

“As AI grows more advanced, the energy required to power massive data centers that run these systems is skyrocketing.” 

It’s true: There is a new high-value commodity in the artificial intelligence gold rush — energy. With data center energy consumption predictions revealing a dramatic increase over the next years to power AI, big tech companies are investing heavily in nuclear energy.

Yashin Manraj, CEO of Pvotal Technologies, a low-code cloud-native platform provider, spoke to Techopedia about why Microsoft would choose Three Mile Island for their project.

Manraj said that Microsoft’s decision to reactivate the nuclear facility is based on comprehensive research into how retrofitting the existing site is faster and cheaper. It also benefits the necessary approval processes.

These benefits, compared to the substantial challenges and costs of building a new nuclear plant, surely played a big role in the final decision.

“By conservative estimates, a new site would have delayed the project by 8-12 years,” Manraj said.

Does AI Need Nuclear Energy? Aren’t Solar & Wind Enough?

Let’s face it: Nuclear energy is considered by many to be the ‘bad boy’ of renewables. The public image is not the greatest.

Environmental activists often advocate for more wind and solar to meet future demands. The IEA – International Energy Agency — predicted that by 2026 wind and solar power generation will both surpass nuclear power.

But big tech’s recent wave of investment in nuclear has come as a surprise.

We asked Matt Miles, Senior Vice President of External Affairs and Marketing at Type One Energy, a fusion power company, whether nuclear power is needed or whether companies should focus on solar and wind.

“Theoretically, AI could operate solely on solar and wind energy, provided energy storage systems and grid management are adequate,” Miles said.

“Therefore, for consistent, large-scale AI operations, a diverse energy mix that includes nuclear and eventually fusion energy as reliable sources would likely be more practical.”

Walker from NANO Nuclear Energy explained that AI systems, particularly the large-scale machine learning models and cloud computing infrastructures that companies like Microsoft rely on, require a stable, continuous, and immense energy supply.

“This is where the limitations of solar and wind energy become clear,” Walker said.

“For companies like Microsoft, which need large amounts of energy to power their data centers, nuclear energy offers a more compact and scalable solution than solar or wind.”

Additionally, nuclear energy’s low-carbon footprint aligns with the sustainability goals that companies like Microsoft are committed to.

The Domino Effect: When Big Tech Owns Nuclear

The influence of big tech companies on almost every sector of society and global markets is undeniable and unstoppable, especially today, as AI becomes the tip of the innovation sword.

But what are the broader reprecursions when companies like Microsoft, Google, Amazon, and others take over the nuclear industry?

Walker from NANO Nuclear Energy told Techopedia that the investment of big tech in nuclear energy represents a transformative moment for the nuclear industry.

Historically, nuclear energy has been primarily supported by government funding and oversight, with private sector involvement largely limited to utility companies and specialized energy firms.

Walker believes that big tech companies’ involvement will accelerate the development of nuclear technologies, improve public perception, and reinvigorate nuclear energy as a central pillar of the global clean energy transition.

“For years, nuclear power has faced challenges related to public perception, largely due to high-profile accidents and concerns over safety and waste management. However, the entry of well-respected and globally recognized tech giants can help change the narrative.”

Miles from Type One Energy agreed that nuclear energy will see a potential acceleration of innovation, decarbonization, and the creation of new economic opportunities.

“Some tech giants may invest in fusion energy projects, which promise a virtually limitless and clean energy source once commercialized.

“However, if tech companies prioritize nuclear energy for their own data centers and operations, there is a risk that smaller industries or regions without a significant tech presence might have less access to affordable clean energy.”

Balancing the benefits and risks for both tech companies and society, Miles said, will be crucial.

The Innovation and Technologies that Microsoft, Google, and Amazon Could Bring to the Nuclear Table

In Pennsylvania, Microsoft is preparing to restore and update the turbine, generator, main power transformer, and cooling and control systems of the nuclear plant, which is expected to be online by 2028.

This restoration represents an opportunity to innovate.

Walker said companies like Microsoft could spur technological advancements in nuclear energy by bringing a unique skill set, particularly in areas like AI, data analytics, and advanced materials. These can be applied to optimize reactor designs, improve safety protocols, and enhance the overall efficiency of nuclear plants.

“For instance, AI could be used to monitor reactor performance in real-time, identify potential issues before they become critical, and streamline maintenance.”

Walker also spoke about non-water cooling technology, which replaces traditional water-cooled reactors to drive safety, energy density production, and performance of nuclear plants.

“Novel coolants like molten salts or liquid metals (e.g., sodium or lead) operate at significantly higher temperatures and without the need for high pressure, which is a game changer for nuclear security.”

The higher boiling points of these novel coolants allow reactors to operate at much higher temperatures — often exceeding 500°C (932°F) or more — while remaining at lower pressures.

“This reduces the risk of pressure-related accidents and increases the overall safety of the system.” 

“In the event of a malfunction, the lower operating pressure means there is no sudden release of steam or coolant, significantly reducing the likelihood of failures such as core meltdowns.”

These higher operating temperatures also enable greater efficiency and power density.

The Bottom Line

Five or ten years ago, most of those debating and addressing global emissions and the transformations required to stop climate change would have never guessed that companies like Google, Microsoft, or Amazon would be investing in nuclear plants as their solution to carbon zero.

AI advancements and the evolving needs of modern computing are driving a shift in policy within technology companies. But is this a good thing? As the world changes, new solutions emerge.

Big tech does indeed have a lot to contribute to nuclear energy. However, as nuclear goes private, a wider public debate is needed.

FAQs