U.S. is reviving shuttered nuclear plants to meet growing electricity demand and to power data centres

At Constellation's nuclear power plant on Three Mile Island, called the Crane Clean Energy Center, near Middletown, Pa., the cooling towers are reflected in the Susquehanna River, June 25, 2025. (AP Photo/Ted Shaffrey)

The United States is making an unprecedented attempt to revive three shuttered nuclear plants to meet rising energy demand, including from large-scale data centres.

No commercial nuclear reactor is known to have resumed generating electricity after beginning the decommissioning process that takes one out of service, though some reactors have restarted after long outages.

The Department of Energy is lending as much as US$4.4 billion to restart the Palisades Power Plant in Michigan, the Crane Clean Energy Center on Pennsylvania’s Three Mile Island and the Duane Arnold Energy Center in Iowa to restore a combined 2.25 gigawatts of electricity, which can power roughly 2 million homes and businesses. All three of the plants closed before their licenses expired, largely because the electricity they produced was considered too expensive.

Not anymore. Two of the plants have contracts with Big Tech companies that will pay a premium to get large amounts of carbon-free energy for data centres. The Trump administration is pushing hard to deploy nuclear power for artificial intelligence and manufacturing. It’s also lending billions of dollars for upgrades to produce more electricity from currently operating nuclear plants.

Restarting a reactor is a fairly quick way to get a lot of electricity, and it’s cheaper than building a new, large reactor, said nuclear engineering expert Todd Allen.

“There’s a demand in the country for more power,” he said. “You have these assets that were previously hooked up. They were previously operable, and you can relatively quickly get them generating electricity again, compared to your other possibilities. For anyone who wants zero carbon, nuclear provides that. For the Trump administration, which really wants nuclear, this fits that story also.”

Restarting a reactor is kind of like restoring a car

Allen compared restarting a decommissioned nuclear plant to restarting a car that sat idle for a few years. The driver still needs a valid license and all the parts need to be working correctly.

“That’s what they’re trying to do with these nuclear plants, but it’s a much bigger, complicated system,” said Allen, associate dean for research at the University of Michigan’s College of Engineering.

With a nuclear plant, the owner has to bring nuclear workers back and ensure their training is current, make sure everything is working and that maintenance is up to date, ensure they have enough fuel and ask regulators to restore their operating license, he added.

Allen said it’s a lot to keep track of, but it’s relatively straightforward.

Expert says restarts are risky

Edwin Lyman, at the Union of Concerned Scientists, said the taxpayer money being used should go toward addressing safety risks. For example, most U.S. plants were built between 1970 and 1990 and were designed to withstand natural disasters of that era, said Lyman, director of nuclear power safety at UCS. But climate change is making extreme weather events more frequent and severe.

“It’s possible, if they set the right level of safety and spend the necessary funds to meet that, they could restore these plants to operable condition,” he said. “That’s not happening at this point.”

Iowa’s only nuclear facility, Duane Arnold, began operating in 1975. It was scheduled to permanently close in October 2020. Replacing it with cheaper energy sources, including wind, was projected to save Iowa customers $300 million in energy costs. The plant shut down early, in August 2020, when it was damaged during a powerful storm known as a derecho.

NextEra Energy owns Duane Arnold. Looking at its condition, CEO John Ketchum said company officials “felt really good about the ability to bring it back.”

Palisades plant is the furthest along

The Palisades plant operated from 1971 until 2022, when its owner, Entergy, left the nuclear power business. The plant’s operating license lasted until 2031.

Holtec International bought it and began dismantling it, though none of the steps were irreversible. Michigan officials, not wanting to lose nuclear jobs or energy, encouraged Holtec to pursue reopening the plant and provided state funding. The Biden administration in 2024 approved a $1.5 billion loan to restart the facility, and the Trump administration continued the payments.

In August, Holtec began loading nuclear fuel, one of the final major phases before a reactor can restart. The company paused the process after a fuel assembly tilted from its upright position and Holtec determined it needed to figure out why. Its power purchase agreements require Palisades to be in service by March 2027.

Holtec says its efforts will restore baseload power, strengthen energy security and demonstrate the role of nuclear energy in meeting the nation’s growing electricity demands.

Big Tech will purchase power for data centres

NextEra Energy and Google are collaborating to restart Duane Arnold by early 2029.

“This is a perfect example of data centres paying their own way,” Ketchum said in an interview. “We’re able to sign a long-term contract with a hyperscaler for that project. So none of the costs are being paid by residential customers in Iowa.”

Microsoft has a contract with the Crane Clean Energy Center on Three Mile Island just outside Harrisburg. The plant was the site of the nation’s worst commercial nuclear power accident in 1979. The accident destroyed one reactor, leaving the plant with one functioning. In 2019, Constellation Energy’s then-parent company Exelon shut down the functioning reactor, saying it was losing money and that Pennsylvania lawmakers had refused to subsidize it.

Constellation Energy announced in 2024 that it would spend $1.6 billion to restart the reactor under a 20-year agreement with Microsoft. It hopes to bring the plant back online in 2027. The Energy Department provided a $1 billion loan, and Deputy Energy Secretary James Danly took a tour last week.

Jack Spencer at The Heritage Foundation said he can’t think of a worse use of taxpayer money than using it to restart reactors. These are low-risk projects where there is a massive demand for the energy, so there is no reason to funnel federal dollars to these companies, said Spencer, director of the foundation’s Center for Energy, Climate and Environment.

Conversely, Jennifer Gordon at the Atlantic Council said she thinks it’s a terrific way of leveraging federal financing to get needed electricity. Gordon directs the council’s Nuclear Energy Policy Initiative.

Industry group says reactors shouldn’t close early

The World Nuclear Association said restarting nuclear reactors should be celebrated, but preventing them from closing prematurely would be the best option.

Palisades is expected to be the first nuclear plant in the world to resume generating power after beginning the decommissioning process, but other countries have restarted or refurbished reactors after long-term shutdowns, the association said. That includes Canada, Armenia, Belgium, Japan, India and South Korea. Others are considering or in the process of restarting reactors.

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Jennifer Mcdermott, The Associated Press

Associated Press writer Sarah Rankin in Richmond, Virginia, contributed to this report.

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