US closes $1.52 billion loan to resurrect Michigan nuclear plant

The U.S. on Monday said it closed a $1.52 billion loan to resurrect Holtec's Palisades nuclear plant in Michigan, and a senior Biden administration official said it could take two years to reopen the plant, which is longer than the company predicted.

President Joe Biden's administration has called for a tripling of U.S. nuclear power capacity as U.S. power demand surges and worries about climate change mount.

The push could include the potential reopening of some commercial reactors that have been shut for decommissioning, including one at Three Mile Island, site of the worst nuclear accident in U.S. history. Restarting shut nuclear plants is a complicated and expensive process never before accomplished in the country.

"Palisades is a climate comeback story," Ali Zaidi, the White House climate adviser, told reporters in a call, adding that nuclear power supports high-paying union jobs.

Nuclear reactors generate virtually emissions-free power, which is valued as electricity demand soars for the first time in decades on growth in artificial intelligence, electric vehicles and crypto-currencies. Nuclear critics point out the U.S. has not agreed on a permanent place to bury radioactive nuclear waste.

Palisades still needs licensing from regulators and the senior U.S. official said that means it could take "a couple of years to turn back on". Holtec has estimated a comeback in the fourth quarter next year.

Patrick O'Brien, a Holtec spokesperson, said Palisades was on target for "repower" in October or later in 2025.

Still, the plant has been shut since 2022 and needs work. The U.S. nuclear regulator said this month that preliminary results from inspections "identified a large number of steam generator tubes with indications that require further analysis and/or repair." Steam generators are sensitive components of a nuclear power plant that require meticulous maintenance.

O'Brien has said Holtec doesn't expect delays or additional costs.

Deputy U.S. Energy Secretary Xochitl Torres Small also announced more than $1.3 billion in public funding that will go to power cooperatives Wolverine and Hoosier Energy to help them complete purchases of electricity from Palisades.