McGuireWoods advised client Constellation in negotiating a 20-year power purchase agreement with Microsoft to launch the Crane Clean Energy Center, restarting Constellation’s Three Mile Island (TMI) Unit 1 in Pennsylvania to produce carbon-free energy for Microsoft’s data centers.
If regulators approve the agreement, the nuclear power facility is expected to be online by 2028. Constellation’s TMI Unit 1 operated at industry-leading levels of safety and reliability before being retired for economic reasons in 2019. Microsoft will purchase energy from the renewed plant as part of its goal to help match the power its data centers consume in the PJM Interconnection region with carbon-free energy. The Crane Clean Energy Center will add approximately 835 megawatts of carbon-free energy to the grid.
According to a recent economic impact study commissioned by the Pennsylvania Building & Construction Trades Council, the plant will create 3,400 direct and indirect jobs, add $16 billion to Pennsylvania’s GDP and generate more than $3 billion in state and federal taxes.
Partner Heather Welch Arbogast led the McGuireWoods deal team, which included partner Brian Kelly and associates Michelle Lim and Mark Staines. All are members of the firm’s Mergers & Acquisitions and Energy Transactional Department and are based in Baltimore. In addition, Richmond partner Jon Neal advised on tax issues.
“We were pleased to assist our valued client Constellation in this transformational deal that will add a reliable source of carbon-free energy to the grid and have significant economic benefits,” Arbogast said.
A Fortune 200 company headquartered in Baltimore, Constellation Energy Corporation is the nation’s largest producer of clean, carbon-free energy and a leading supplier of energy products and services to businesses, homes, community aggregations and public sector customers across the continental United States, including three fourths of Fortune 100 companies.