New media reports are circulating this week about a massive federal loan to get a nuclear power plant in Michigan back in commission. According to Bloomberg News, the U.S. Department of Energy is “poised” to give Holtec a $1.5 billion loan to get the Palisades nuclear plant back up and running.
The future for nuclear energy in southwest Michigan seemed bleak in 2022. Entergy had closed the Palisades nuclear plant, operating between Benton Harbor and South Haven, and sold it soon after to Holtec International to come in and handle the facility’s decommissioning.
But over the past year and a half, a series of measures to try and reopen the plant have sprung up. Michigan Gov. Gretchen Whitmer has pushed hard for federal funding to reopen the plant and with the Biden Administration’s goal of making the country’s power grid carbon neutral by 2035, the Palisades plant coming back online became a possibility.
The reported loan is the latest big step towards getting the plant back up and running. Bloomberg says the loan could be approved sometime this month.
Holtec spokesman Nick Culp didn’t confirm that number to WVPE on Thursday, but he said the company is excited about the prospect of restarting the plant.
“We obviously have a pretty high degree of confidence in the strength of our application and the merits for the project, where we feel confident enough to go down this track to go out of pocket spending for a potential restart,” Culp said.
If the loan does go through, Culp said the plant could be operational by the end of 2025. Culp said Holtec currently has around 230 employees that are working on decommissioning the site, but the company is now working on rehiring workers from when the plant was running. At full scale, Culp estimates the plan will employ close to 600 people.
“It’s rehiring your staff, procuring new fuel for the reactor, doing significant inspections, equipment upgrades modifications — it’s a really big project,” he said.
If all goes to plan, The Palisades facility would be the first nuclear power plant in the U.S. to be successfully restarted. The plant was first commissioned in the 1970s and closed in 2022. However, Michigan lawmakers worked fast to win financial support for the plan when it closed, urging former Michigan Gov. Jennifer Granholm, who is currently the U.S. Secretary of Energy, for federal funding.
In a 2022 interview, Granholm said nuclear power is an important part of the Biden administration’s energy policy. Biden’s infrastructure legislation set aside $6 billion to rescue nuclear power plants who were struggling to stay open.
“The DOE has not historically subsidized plants,” Granholm said in 2022. “We’re not going to be able to achieve our climate goals if our nuclear power plants shut down. We have to find a way to keep them operating.”
Beyond the federal dollars, Culp said a key to the plant being able to feasibly open is a long-term power agreement with Wolverine Power Cooperative that will see the nonprofit rural energy provider buy two thirds of the electricity generated by the plant.
Culp said that agreement gives the plant stability versus trying to sell the energy on a more ad-hoc basis.
Data from the U.S. Energy Information Administration says nuclear power generates nearly 20% of electricity in America and 10% of energy worldwide.
“This is a transformative, historic opportunity not just for the state of Michigan, but for the United States to demonstrate globally its leadership on energy,” Culp said.
Aside from the possible loan, Holtec was also in the news this week when the company agreed to pay a $5 million fine in New Jersey to avoid criminal prosecution over suspicious tax credits.
