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The U.S. Department of Energy will provide a loan of $1.5 billion to Holtec, the energy equipment supplier, to reopen the Palisades nuclear power plant in Michigan.
This is according to a Reuters report citing an unnamed source who said the loan will be made public next month.
This would be the first time ever that a closed nuclear power plant in the United States would be reopened.
A spokesperson for Holtec confirmed the news of the reopening, saying "We hope for a timely approval to bring the plant back to full power operation toward the end of 2025."
“As we transition away from fossil fuels, nuclear is going to be a critical part of not only reaching our climate goals but doing so in a way that ensures the lights stay on,” Nick Culp also said.
Holtec originally bought the Palisades nuclear plant in 2022 from Entergy with the intention of decommissioning it as federal and state energy policies made it harder for nuclear power to compete with other forms of energy.
However, last year the Biden administration rediscovered nuclear power as a low-carbon option and signaled they would support more nuclear—especially as it emerged the massive buildout in wind and solar that the administration saw as the only way to transition away from oil and gas might not be that easy to do.
As interest in nuclear returned Holtec filed an application with the Nuclear Regulatory Commission last October to reopen the facility. A month later, the company had also signed a deal with a Michigan non-profit energy cooperative to buy up to 66% of the power that Palisades would generate.
The Palisades plant has a capacity of 800 MW, and Holtec last year announced plans to build two new reactors at the site—small modular reactors with a capacity of 300 MW each. The company, however, said that without federal funding it would not be able to reopen Palisades and would have to instead decommission it.
By Charles Kennedy for Oilprice.com
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Charles is a writer for Oilprice.com