A unit of nuclear services firm Holtec International is working toward what could be the first recommissioning of a shut-down U.S. nuclear power plant, the Palisades Nuclear Plant in Covert Township, Mich. That effort got a boost March 27 as the U.S. Dept. of Energy Loan Programs Office offered Holtec Palisades LLC a conditional loan guarantee of up to $1.52 billion for the project.

The 800-MW Palisades plant, located on the eastern shore of Lake Michigan, ceased operations in May 2022, and was acquired from former owner Entergy Nuclear by Holtec the following month, which intended to decommission the facility. 

It was one of a number of aging plants decommissioned or in process over the last decade as they reached the end of their useful lives or could not compete with lower cost natural gas power facilities, with industry firms using preset trust funds to finance the shutdowns.

However, Holtec and Michigan Gov. Gretchen Whitmer announced later that year that they wanted to reopen the facility. Michigan officials have already budgeted $150 million toward restarting the plant. 

Last year, the firm started the U.S. Nuclear Regulatory Commission’s process to reauthorize power operations at the plant. The company also plans to use the site for the first two of its small modular reactor units that could potentially double the site’s capacity, although DOE officials said that work cannot be financed under the newly announced loan guarantee. 

Holtec has already reached multi-decade power purchase agreements with a pair of nonprofit rural electric cooperatives, Wolverine Power Cooperative and Hoosier Energy, for Palisades’ output. 

“The repowering of Palisades will restore safe, around-the-clock generation to hundreds of thousands of households, businesses and manufacturers,” said Kris Singh, Holtec president and CEO, in a statement. “It also confers the environmental and public health benefits of emissions-free generation, hundreds of high-paying local jobs with a large union workforce, economic growth and the social benefits of a strong community partner.”

The project is the first to be offered a conditional commitment through DOE's Energy Infrastructure Reinvestment program funded by the 2022 Inflation Reduction Act, which is focused on projects that repurpose shuttered energy infrastructure or enable energy infrastructure to reduce air pollution. 

Reopening the Palisades plant is expected to avoid 4.47 million metric tons of carbon dioxide emissions per year during a projected 25 years of operation, according to DOE. 

The Biden administration has turned to nuclear energy as one source to help meet its goals of achieving a 100% clean electric grid by 2035 and a net-zero emissions economy by 2050. As ENR previously reported, Energy Secretary Jennifer Granholm has said the U.S. needs to add 200 GW of nuclear power to meet a COP28 climate change summit goal of tripling its nuclear capacity as part of efforts to phase out fossil fuel use. 

“Nuclear power is our single largest source of carbon free electricity,” Granholm said in a statement. 

Working toward those goals, the nuclear sector has looked at extending the operational life of existing nuclear plants like Diablo Canyon in California and at using small modular reactors to expand capacity of existing nuclear sites. 

Because the plant’s infrastructure is already largely in place, DOE officials say the project would not involve major construction. But the site would still need refurbishment, rebuilding and replacement of existing equipment, as well as inspections and testing. 

Holtec anticipates submitting the rest of needed NRC licensing requests for Palisades this spring. The company has said the plant could restart by the end of 2025, pending approvals, and aims for the first small modular reactor to come online by mid-2030.