WASHINGTON: The U.S. Department of Energy announced on Monday that it has released $57 million from a loan guarantee of up to $1.52 billion for Holtec's Palisades nuclear facility in Michigan, which the company aims to be the first American commercial reactor to resume operations after halting. The conditional loan guarantee was a component of an initiative by the administration of former President Joe Biden to promote nuclear energy, which produces almost emissions-free electricity, to mitigate climate change and to address the increasing electricity demand from artificial intelligence, electric vehicles, and digital currency.
$57M Funding for Nuclear Revival
The initial payout from the department on the loan guarantee, approximately $38 million, took place in January following the closure of financing by its Loan Programs Office last year. "Today’s initiative marks yet another move in support of President (Donald) Trump’s promise to enhance domestic energy output, strengthen our security, and reduce expenses for the American public," stated Energy Secretary Chris Wright in a press release.
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Power company Entergy (ETR.N) shut down the 80-megawatt Palisades reactor in Michigan in 2022 after the facility produced electricity for over 50 years. It closed two weeks early due to an issue with a control rod, despite a $6 billion federal initiative for assisting nuclear plants facing increasing expenses.
Holtec aims to restart the facility in the fourth quarter of 2025, yet still requires approvals from the Nuclear Regulatory Commission. Holtec is working on steam generator repairs at Palisades since the usual maintenance procedures for the units were not adhered to during the plant's shutdown. Holtec representative Pat O'Brien stated that the company is "making significant progress towards unlocking American energy."
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