Holtec International has struck out in its pitch to the Department of Energy’s Civil Nuclear Credit Program for funds to revitalize the shuttered Pilgrim nuclear plant in Michigan while Pacific Gas and Electric has made it to first base on plans to extend the life of the operation Diablo Canyon two-unit nuke.
The Biden administration’s Inflation Reduction Act funds the $6 billion program aimed at keeping existing reactors running to prevent air pollution, primarily carbon dioxide, from substitute sources of electricity. The Holtec bid for Palisades was a long shot, while awarding PG&E conditional approval for $1.1 billion for keeping Diablo Canyon running was no surprise.
Holtec, which has no direct experience operating nuclear plants while specializing in decommissioning them, bought the 805-MW single unit Palisades plant from Entergy in December to decommission it. The plant closed because of its inabillity to compete with generation fueled by low-cost natural gas. When Congress created the Biden infrastructure program, the aggressive Holtec decided to take a swing with Palisades. Holtec spokesman Patrick O’Brien said in a statement, “We fully understood that what we were attempting to do, re-starting a shuttered nuclear plant, would be both a challenge and a first for the nuclear industry.”
Washington-based ClearView Energy Partners, an analysis firm, told Reuters in September, when Holtec applied to DOE for the new funds, that the Palisades closure was “likely to be permanent,” as the 1973-vintage plant (original cost $630 million) was out of nuclear fuel, had control rod drive seal issues that needed to be fixed, would need an experienced company to operate it, and a buyer for its power.
Michigan’s Democratic Governor Gretchen Whitmer (reelected this month) in September sent a letter to Energy Secretary Jennifer Granholm, her immediate predecessor as Democratic Governor of Michigan, strongly supporting Holtec’s funding application. “With your support, Holtec plans to repower and reopen the Palisades, a union plant in Southwest Michigan that employs 600 workers making an average of $117,845, supports over 1,100 regional jobs, generates $363 million in annual regional economic development, and produces more than 800 megawatts of reliable, clean power. Keeping Palisades open is critical for Michigan’s competitiveness and future economic development opportunities,” Whitmer pled, to no avail.
Local anti-nuclear groups opposed the Holtec and Whitmer support to Palisades but appear to have had no role in the decision to reject rescue of the plant.
The Neutron Bytes blog noted, “Even if DOE had come through with the money, relicensing the plant presented a major challenge to Holtec and the Nuclear Regulatory Commission (NRC). The agency public affairs office said in an email statement to this blog that the agency has never dealt with a plant that involves re-licensing a closed nuclear reactor. However, in 2016 the agency took a look at the possibility of restarting a closed reactor and solicited input from the industry to address the issue.”
On the other hand, the Diablo Canyon decision was easy for DOE. The plant is currently operating well, the California Governor, once an opponent of extending the license for the two-unit, 2,200-MW plant, which expires in 2025, came up with a plan to keep the plant operating and convinced the state legislature to support that, along with a $1.4 billion “non-recourse” loan. Granholm said, ““This is a critical step toward ensuring that our domestic nuclear fleet will continue providing reliable and affordable power to Americans as the nation’s largest source of clean electricity,”
Holtec and PG&E were the only applicants for the first round of the DOE program.
–Kennedy Maize