Owners of the Palisades nuclear plant in Southwest Michigan may seek $300 million in state funding to reopen the facility.
The owner and operator of a shuttered Southwest Michigan nuclear power plant may ask for about $300 million in state funding to help reopen the facility.
Holtec International has launched an unprecedented effort to reopen a nuclear plant after it had already closed for decommissioning. The Palisades nuclear plant in Van Buren County shut down in May of 2022. Holtec acquired the facility from Entergy Corp. the following month.
Since then, the federal government announced a $6 billion program to save U.S. nuclear plants at risk of closing to preserve them as sources of clean energy under a broader climate change strategy to reduce carbon emissions. Gov. Gretchen Whitmer has supported reopening Palisades to align with her administration’s climate strategy.
The Herald-Palladium reported on Tuesday that two state representatives said Holtec is seeking $300 million in state funding to support the reopening plan.
Officials say that state funding would be necessary to complement a roughly $1 billion U.S. Department of Energy loan that Holtec applied for last month. The federal loan would be the primary investment into reopening the nearly 800-megawatt capacity Palisades.
A Holtec spokesperson said the company has not publicly disclosed an amount of state funding that would be needed to reopen Palisades.
“We applaud the Governor for prioritizing the repowering of Palisades and bringing all parties together to find a solution,” Holtec spokesperson Patrick O’Brien said in an emailed statement. “As we work with the Department of Energy through the loan application process, the financial commitment from Michigan and a power purchase agreement are both essential to making a return to operations feasible.”
Whitmer spokesperson Bobby Leddy said Palisades is a “critical energy source and economic driver” for Southwest Michigan.
“That’s why Governor Whitmer continues to support efforts to reopen the Palisades power plant, protecting 600 high-paying jobs and hundreds of millions of dollars in annual regional economic development,” Leddy said in a statement. “We are in communication with Holtec and working to secure federal funding to move the ball forward. In the meantime, the state continues to have enough energy to meet the needs of families, communities, and small businesses.”
The amount of state funding will likely depend on the outcome of the federal loan application.
State Rep. Joey Andrews, a St. Joseph Democrat whose district includes the plant, said Holtec needs $300 million if it wins approval to reopen the facility. The money, he said, would help “bridge the gap” because the company would no longer be able to access decommissioning trust funds but would need to start hiring employees, refueling and taking other operational steps to generate electricity again.
Andrews supports the aid.
“I’m pretty pro-nuclear in general. If we’re going to decarbonize the grid, nuclear energy is the best way for us to transition off of coal and gas,” he said. “We have this existing plant. We don’t have to build a new one. It costs billions to build a new plant. This is actually, I think, a pretty good deal to get an existing plant up and running again.”
He said the U.S. Nuclear Regulatory Agency would ensure the transition is done safely.
“They’re talking about bring back on 400, 450 people. Those are all six-figure jobs, and it’s millions, hundreds of millions of dollars in tax revenue for the county, for the schools, for the township. It’s a huge deal for the local community.”
Andrews said Holtec is committed to restarting the plant.
“They decided to take on debt themselves to sort of demonstrate their commitment to the process,” he said. “They’re not just asking for government money. They put some skin in the game, too.”
Senate Minority Leader Aric Nesbitt, a Porter Township Republican whose district includes Palisades, did not say whether he supports $300 million in state funding for Palisades, but he believes “we need to keep any and all options on the table.”
“Let’s be clear. We all want to see Palisades back online as soon as possible, providing jobs to Michigan workers and producing clean, reliable energy for the people of Southwest Michigan,” Nesbitt said in a statement. “I think we have a great opportunity here to strengthen our Michigan and American energy supply, but obviously a number of significant hurdles remain before the plant becomes operational again. I think we need to keep any and all options on the table.”
No U.S. nuclear plant has attempted to restart once decommissioning has begun.
O’Brien told MiBiz late last year that restarting a nuclear plant after notifying federal nuclear regulators that it would close via “letter of permanent secession” of operation “is almost like a brand new relicensing. The (Nuclear Regulatory Commission) doesn’t have a process for restarting something that’s sent in that letter. Other plants have restarted, but no one has restarted after sending that letter in.”
The Biden administration and several states have launched efforts to maintain existing nuclear plants that are at risk of shutting down because they are too expensive to operate compared to natural gas and renewable energy. Supporters of such a strategy say existing nuclear plants play a key role in achieving climate change targets and holding down carbon emissions by avoiding the displacement of nuclear power with natural gas.
After being rejected for federal funding under the civil nuclear credit program, Holtec last month requested about $1 billion in funding from the Department of Energy’s loan office.
Source: MiBiz