In an effort to find a power source big enough to fuel its ambitious artificial intelligence business, Microsoft has sought to revive a shuttered nuclear power plant in Pennsylvania. AI notably needs an absurd amount of energy to function, and companies have floated nuclear power as a potential solution. In September, Microsoft signed a deal to re-open the power plant on Three Mile Island, the likes of which has been shuttered since 2019. The plant is notorious for having been the site of a meltdown—the worst in American history—that occurred in 1979. The financials of Microsoft’s deal have recently come to light, with a new report suggesting that the tech company and its business partner want American taxpayers to front some of the risks associated with the plant’s re-opening.

The Washington Post reports that Constellation Energy, the utility company that owns and operates the reactor at Three Mile Island, filed an application for a $1.6 billion federal loan guarantee with the U.S. Department of Energy in May. The Post writes that the application has already cleared an initial review and is now at the stage where specifics of the agreement are being negotiated. A loan guarantee would essentially ensure a certain amount of federal financial support for the deal, regardless of whether it ultimately succeeds or not.

The controversy from this potential agreement stems from the fact that it could be seen to offload over a billion dollars of financial risk onto the shoulders of taxpayers. Should anything go wrong with the business arrangement and were Constellation to default on its obligations, the government would still be forced to cover up to $1.6 billion in costs, the newspaper reports. Constellation has rushed to assure observers that no such thing will happen.

“Rest assured that to the extent we may seek a loan, Constellation will guarantee full repayment,” Constellation told the Post. “Any notion that taxpayers are taking on risk here is fanciful given that any loan will be backstopped by Constellation’s entire $80-billion-plus value.”

Gizmodo reached out to Constellation and Microsoft for comment.

The deal has already enjoyed a number of federal tax credits (some of which may be worth as much as $200 million a year for the two companies, the Post writes), which would seem to imply that the government is supportive of the project. The U.S. Energy Secretary has openly complimented the effort, claiming the government is “bullish” on it.

Some commentators have noted that, while most nuclear power deals are heavily facilitated through federal handouts, this deal is being almost exclusively financed by Microsoft and it intends to be the main beneficiary of the plant’s services. That said, other voices have noted that the deal will likely require more federal dollars as it progresses. “The $1.6 billion is just the start,” Stanford professor of civil and environmental engineering Mark Jacobson told The New Republic. “Microsoft will be asking for government handouts just like most all other aged nuclear reactor owners have asked in multiple states.”

If Microsoft’s deal is finalized, the Three Mile Island reactor would be restarted by the year 2028. Microsoft would then have a 20-year contract with Constellation that assured it ownership over 100 percent of the plant’s output during that time.

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