By Laila Kearney

NEW YORK (Reuters) - U.S. nuclear regulators kicked off a long-winding process to consider Constellation Energy's unprecedented plans to restart its retired Three Mile Island nuclear power plant in an initial public meeting held on Friday.

Constellation, which announced last month that it had signed a 20-year power purchase agreement with Microsoft that would enable reopening the Unit 1 reactor at Three Mile Island, made its case before the Nuclear Regulatory Commission to restore its operating license for the plant.

The company also sought to extend the life of the plant and change its name to the Crane Clean Energy Center.

Three Mile Island, which is located in Pennsylvania on an island in the Susquehanna River, is widely known for the 1979 partial meltdown of its Unit 2 reactor. That unit has been permanently shut and is being decommissioned.

Members of the NRC requested details about the emergency evacuation plans for the restarted plant and information about the commercial deal with Microsoft, while imploring Constellation to quickly work on permitting related to its water use for the plant.

The NRC also raised questions about how the restart of Unit 1 would intersect with the decommissioning of Unit 2, which began last year, nearly 45 years after the partial meltdown.

Utah-based nuclear services company EnergySolutions owns Unit 2 and related infrastructure, while Constellation owns Unit 1 and the site's land.

Unit 1 shut down due to economic reasons in 2019, some 15 years before the operating license was set to expire. At the time, Constellation said it did not anticipate a restart.

Constellation now expects to restart the 835-megawatt Unit 1 in 2028, delivering power to the grid to offset electricity use by Microsoft's data center in the region.

A recent jump in U.S. electricity demand, driven in part by Big Tech's energy-intensive AI data center expansion has led to a revival of the country's struggling nuclear industry.

No retired reactor has been restarted before. The Palisades nuclear plant in Michigan, owned by Holtec, is also in the process of being resurrected.

Earlier this year, Constellation completed initial testing on the reactor and determined it was physically, and financially, possible to resurrect it.

"We understand how we shut it down and we have a good idea of how we are going to restart this," plant manager Trevor Orth said at the NRC meeting.

The physical work to restore Three Mile Island, which is expected to start in the first quarter of 2025, cost at least $1.6 billion, and could require thousands of workers, still needs licensing modifications and permitting.