Biden Cabinet to provide $1.5 billion in loans for first U.S. nuclear power plant

Joe Biden’s administration will provide a $1.5 billion loan to restart a nuclear power plant in southwest Michigan, officials announced Wednesday.

Holtec International acquired the 800-MW Palisades power plant in 2022 and plans to dismantle it. But with the support of Michigan and the Biden administration, the focus is now on restarting by the end of 2025.

Governor Gretchen Whitmer said it would be the first nuclear power plant to reopen in the United States. It still faces hurdles, including inspections, testing and approval from the U.S. Nuclear Regulatory Commission (NRC).

“Nuclear power is our largest single source of carbon-free electricity, supporting 100,000 jobs directly across the country and hundreds of thousands more indirectly,” said former Michigan Governor and Energy Secretary Jennifer Granholm .

The Palisades facility is located on the shores of Lake Michigan, a two-hour drive from Chicago. Michigan utility CMS Energy owned the plant from 1971 until 2007, when it sold the plant to Louisiana utility Entergy. The plant will close in 2022.

So far, two electric cooperatives have long-term commitments to purchase power from the plant, Holtec said.

“Repowering the Palisades will restore safe, around-the-clock power generation to hundreds of thousands of homes, businesses and manufacturers,” said Kris Singh, president and CEO of Holtec.

However, critics also emerged. A coalition opposed to restarting what have been derided as “zombie reactors” has requested a hearing before the National Research Council.

Holtec spokesman Patrick O’Brien said it would take four to five months to finalize a financial agreement with the government.

“This is a loan we have to repay,” he said.

Nuclear energy is in the spotlight. Thirty-four countries, including the United States, pledged last week to use it to reduce dependence on fossil fuels. In California, regulators said in December that the Diablo Canyon power plant may operate until 2030 instead of 2025 to prevent blackouts as the state shifts to renewable energy. Owner Pacific Gas & Electric Co. said federal aid helped it pay off state loans.

“There is growing enthusiasm for nuclear power in Congress, industry and internationally,” said Najmedin Meshkati, a professor of engineering at the University of Southern California who has visited nuclear power plants around the world.

But he said restarting factories won’t be easy.

“This puts the responsibility and burden on the Nuclear Regulatory Commission and Holtech to double down on efforts to ensure that the plant is sufficiently safe and that all safety measures are intact,” Mescati said of Palisades.