A shut-down nuclear power plant in Michigan could get a second life thanks to a $1.52 billion loan from the US Department of Energy. If successful, it will be the first time a shuttered nuclear power plant reopens in the US.
Palisades Power Plant shut down on May 20, 2022, after 50 years of generating low-carbon electricity. But the plant’s new owner thinks economic conditions have improved in the past few years and plans to reopen by the end of 2025.
A successful restart would be a major milestone for the US nuclear fleet, and the reactor’s 800 megawatts of capacity could help inch the country closer to climate goals. But reopening isn’t as simple as flipping on a light switch—there are technical, administrative, and regulatory hurdles ahead before Palisades can start operating again. Here’s what it takes to reopen a nuclear power plant.
Step 1: Stay ready
One of the major reasons Palisades has any shot of restarting is that the site’s new owner has been planning on this for years. “Technically, the stars had all aligned for the plant to stay operating,” says Patrick White, research director at the Nuclear Innovation Alliance, a nonprofit think tank.
Holtec International supplies equipment for nuclear reactors and waste and provides services like decommissioning nuclear plants. Holtec originally purchased Palisades with the intention of shutting it down, taking apart the facilities, and cleaning up the site. The company has decommissioned other recently shuttered nuclear plants, including Indian Point Energy Center in New York.
Changing economic conditions have made continued operation too expensive to justify for many nuclear power plants, especially smaller ones. Those with a single, relatively small reactor, like Palisades, have been the most vulnerable.
Once a nuclear power plant shuts down, it can quickly become difficult to start it back up. As with a car left out in the yard, White says, “you expect some degradation.” Maintenance and testing of critical support systems might slow down or stop. Backup diesel generators, for example, would need to be checked and tested regularly while a reactor is online, but they likely wouldn’t be treated the same way after a plant’s shutdown, White says.
Holtec took possession of Palisades in 2022 after the reactor shut down and the fuel was removed. Even then, there were already calls to keep the plant’s low-carbon power on the grid, says Nick Culp, senior manager for government affairs and communications at Holtec.
The company quickly pivoted and decided to try to keep the plant open, so records and maintenance work largely continued. “It looks like it shut down yesterday,” Culp says.
Because of the continued investment of time and resources, starting the plant back up will be more akin to restarting after a regular refueling or maintenance outage than starting a fully defunct plant. After maintenance is finished and fresh fuel loaded in, the Palisades reactor could restart and provide enough electricity for roughly 800,000 homes.
Step 2: Line up money and permission
Support has poured in for Palisades, with the state of Michigan setting aside $300 million in funding for the plant’s restart in the last two years. And now, the Department of Energy has issued a conditional loan commitment for $1.52 billion.
Holtec will need to meet certain technical and legal conditions to get the loan money, which will eventually be repaid with interest. (Holtec and the DOE Loan Programs Office declined to give more information about the loan’s conditions or timeline.)
The state funding and federal loan will help support the fixes and upgrades needed for the plant’s equipment and continue paying the approximately 200 workers who have stayed on since its shutdown. The plant employed about 700 people while it was operating, and the company is now working on rehiring additional workers to help with the restart, Culp says.
One of the major question marks remaining around a possible Palisades restart is getting authorization from regulators. The Nuclear Regulatory Commission oversees nuclear power plants in the US, but the agency doesn’t have an established pathway for reauthorization of a previous plant. “We’re breaking new ground here,” says Jacopo Buongiorno, a professor of nuclear engineering at MIT.
Palisades effectively gave up the legal right to operate when it shut down and took the fuel out of the reactor. Holtec will need to submit detailed plans to the NRC with information about how it plans to reopen and operate the plant safely.
Holtec formally began the process of reauthorizing operations with the NRC in October 2023 and plans to submit the rest of its materials this year.
Step 3: Profit?
If regulators sign off, the plan is to have Palisades up and running again by the end of 2025. The fuel supply is already lined up, and the company has long-term buyers committed for the plant’s full power output, Culp says.
If all goes well, the plant could be generating power until at least 2051, 80 years after it originally began operations.
Expanded support for low-carbon electricity sources, and nuclear in particular, have helped make it possible to extend the life of older plants across the US. “This restart of a nuclear plant represents a sea change in support for clean firm power,” says Julie Kozeracki, a senior advisor for the US Department of Energy’s Loan Programs Office.
As of last year, a majority of Americans (57%) support more nuclear power in the country, up from 43% in 2016, according to a poll from the Pew Research Center. There’s growing funding available for the technology as well, including billions of dollars in tax credits for nuclear and other low-carbon energy included in the Inflation Reduction Act.
Growing support and funding, alongside rising electricity prices, contribute to making existing nuclear plants much more valuable than they were just a few years ago, says MIT’s Buongiorno. “Everything has changed,” he adds.
But even a successful Palisades restart wouldn’t mean that we’ll see a wave of other shuttered nuclear plants reopening around the US. “This is a really rare case where you had someone doing a lot of forward thinking,” White says. For other plants that are nearing decommissioning, it would be cheaper, simpler, and more efficient to extend their operations rather than allowing them to shut down in the first place.
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