The Biden administration is willing to lend $1.5 billion for what would be the first restart of a shuttered U.S. nuclear reactor, the latest sign of strengthening federal government support for the atomic industry.
The financing, which will receive conditional backing from the U.S. Department of Energy, will be offered next month to Holtec International Corp. to restart its Palisades nuclear plant in Michigan, according to people familiar with the matter.
Holtec has said restarting the reactor is dependent on a federal loan. Without that support, the company has said it would dismantle the site.
The funding comes as the Biden administration prioritizes maintaining the country’s fleet of nuclear plants to help meet its ambitious climate goals, including a plan to decarbonize the power grid by 2035. More than a dozen reactors have closed since 2013 in amid competition from cheaper natural energy. gas and renewables, and the Department of Energy has warned that half of the country’s nuclear reactors are at risk of closing due to economic factors.
A spokeswoman for the Department of Energy’s Loan Programs Office declined to comment, citing commercial confidentiality.
Nick Culp, a spokesman for Holtec, said the company was “very optimistic” about the Department of Energy’s loan process.
“This is a historic opportunity for the country and Michigan,” Culp said. “As we move away from fossil fuels, nuclear energy will be a critical part of not only meeting our climate goals, but also doing so in a way that ensures the lights stay on.”
Holtec acquired the 800-megawatt power plant in 2022 after Entergy Corp. closed it for financial reasons, but began moving forward with plans to restart it after pleas from Michigan Gov. Gretchen Whitmer.
The Juniper, Florida-based company’s plans to restart got a boost after Wolverine Power Cooperative, a local power company, agreed to buy up to two-thirds of the plant’s output starting in late 2025, although it faced additional hurdles, including signing. far from federal nuclear regulators, it continues to exist.
The financing would be backed by a loan guarantee program designed to revitalize aging power plants created in President Joe Biden’s climate law. If successful, Palisades would be the first nuclear reactor funded by the Biden administration.