The Potential of a Closed Power Plant in Michigan to Revolutionize Nuclear Energy

The Palisades Power Plant on the shores of Lake Michigan had become a piece of history, a relic of an era when nuclear energy was viewed as the future.

The reactor in Covert, Michigan, about 70 miles of southwest of Grand Rapids, ceased operations in May 2022 after providing power to the industrial Midwestern state for more than 40 years.

The closure was part of a decade-long wave of reactor shutdowns in the U.S., as nuclear power struggled to compete against cheap, abundant natural gas in the wake of the shale boom and the rapid expansion renewable energy.

Plus, the power source had long been controversial, with opponents who feared the consequences of waste produced by the process or the potential of radiation leaks in the event of an accident.

But Palisades is now poised to become the first reactor in U.S. history to reopen after shutting down. Lawmakers on both sides of the political divide, tech companies and leading utilities increasingly view nuclear as a crucial source of reliable, carbon-free energy to supply rising electricity demand in the U.S. while slashing emissions to address climate change.

Holtec International, the privately held owner of the Palisades, aims for the plant to resume operations by the end of 2025 with the support of up to $1.5 billion in loans from the Department of Energy and $300 million in grants from the state of Michigan.

The plans to reopen Palisades are under review by the Nuclear Regulatory Commission. If successful, Palisades could provide a road map for other mothballed plants to resume operations such as Three Mile Island in Pennsylvania.

“It’s a bridge to our small modular reactor program,” Kelly Trice, president of Holtec, said in a nod to its long-term plan to nearly double the facility’s power generation in 2030 with small modular reactors. The new technology, which could become the first of its kind on the U.S. grid, promises to speed deployment of nuclear plants in the future.

“Our goal is to be able to increase plants in the country and elsewhere in the world with small modular reactors,” he said.

Florida-based Holtec bought Palisades in 2022 with the intention of dismantling it. The previous owner, Entergy, shut down the facility as its finances deteriorated under the strain of competing with cheap natural gas.

But Michigan Gov. Gretchen Whitmer made restarting Palisades a priority, saying it could support the state’s push to produce all of its energy from clean sources by 2040. Whitmer signed bipartisan legislation that provided state funding and supported Holtec’s application for federal financing.

“It was not shut down for so long that it was irreversible,” Trice said. “This plant actually had a 10-year period where we weren’t going to do heavy decommissioning work.”

A restart of Palisades could mark a turning point for the nuclear industry after a decade in which a dozen reactors have shut down across the country. The 800-megawatt reactor would provide enough power for more than 800,000 homes.

SMRs are viewed as an important path to expand nuclear power because they promise to reduce capital costs, a major hurdle to building new plants. They use a pressurized water reactor, like traditional plants. However, SMRs are prefabricated in pieces and then assembled at the construction site.

“It’s a smaller, simpler plant in comparison — it’s easier to operate,” Trice said.

Once the first SMR is built, Holtec plans to build an order book to “continually manufacture components for whatever plant is needed,” he said. “We’ve had more utilities than I can count contact us and want to be on the list,” Trice said.

The Big Tech companies are also showing growing interest in nuclear, including Holtec’s SMR program. As the tech giants build out power-hungry data centers to support AI, they are still hoping to meet their climate goals.

“We’ve talked to pretty much all of them, especially the big ones have talked to us,” Trice said. “They’re all interested in carbon-free, green, baseload power.”

In conclusion, the potential reopening of the Palisades Nuclear Generating Station represents a significant development in the field of nuclear energy. With increasing demand for reliable, carbon-free power sources to address climate change, the resurgence of nuclear power plants like Palisades offers a promising solution.

As Holtec International works towards restarting Palisades and potentially expanding it with small modular reactors, the future of nuclear energy in the U.S. looks brighter. The success of this endeavor could pave the way for other shuttered plants to resume operations, ushering in a new era of sustainable power generation.

With support from state funding and federal financing, the Palisades project demonstrates a collaborative effort to harness the benefits of nuclear energy while addressing environmental concerns. As the industry evolves and adopts innovative technologies, such as SMRs, the prospect of a cleaner and more efficient energy grid becomes increasingly achievable.

Looking ahead, initiatives like the Palisades reopening offer inspiration for the broader energy sector and serve as a reminder of the importance of exploring diverse energy sources to meet the growing demands of a modern society. With continuous innovation and strategic partnerships, the future of nuclear power in the U.S. holds great promise.