Why restarting a nuclear power plant may be more difficult than expected
When Michigan’s oldest operating nuclear power plant shut down in 2022, it was supposed to be for good. The plant, which sits on the shores of Lake Michigan, had company—dozens of other reactors had already been shut down.
But soon after the turbines stopped spinning, those plans changed. A little-known company in Camden, New Jersey, has quietly begun taking steps to try to do what no one in the United States has done before: restart a shuttered nuclear reactor. The process would take about two years, Holtec International estimates.
Four years later, the Palisades plant is still not generating electricity.
The delay is a reminder of the challenges associated with expanding nuclear power, even at a time when the technology enjoys broad bipartisan support. The United States has built only two new reactors in the past decade. They cost more than twice as much as planned and arrived seven years late, dampening interest in the energy industry and on Wall Street.
Some of the setbacks at Palisades have been expensive and time-consuming, including the discovery of extensive corrosion of equipment that uses hot radioactive water to produce high-pressure steam. Others were mundane: supply chain headaches, underground water lines that leaked, valves that needed replacing.
None of these challenges were unforeseen. Holtec has never operated a nuclear power plant. She also embarked on the project almost immediately after buying the Palisades. The company applied for federal grants for the effort seven days after the sale closed, according to records obtained by The New York Times.
At the time Holtec decided to restart Palisades, it had not completed a top-to-bottom inspection of the plant, Jeff Borah, general manager of plant operations, said in an interview.
“We didn’t take the time to really plan the whole project before we started work,” Mr Borah said. “It’s like building a fire truck on the way to a fire.”
Now Holtec aims to load fuel into the nuclear reactor in September, records show, and produce electricity by the end of the year. His contract expires in March 2027.
The Palisades restart is part of a larger effort to revive nuclear power in the United States. The Trump administration, like the Biden administration before it, is throwing away billions in federal funding to jump-start investment. In June, the Energy Department offered up to $17.5 billion in subsidized loans to buy nuclear equipment in hopes of having 10 large reactors under construction by 2030.
“We’re going to do whatever it takes to get this going,” Chris Wright, the energy secretary, said in an interview.
Jigar Shah, who led the Energy Department’s loan office during the Biden administration, said Holtec’s work encouraged other companies to pursue similar projects. Constellation Energy and NextEra Energy followed Holtec by agreeing to reopen nuclear reactors in Pennsylvania and Iowa.
“I don’t think there’s anything wrong with Holtec being optimistic,” said Mr. Shah, whose office secured a low-interest loan of up to $1.52 billion to finance the restart of Palisades, which has the capacity to meet the electricity needs of more than 800,000 homes. “They thought they were going to inherit a plant that was in much better shape.”
A Holtec executive and former nuclear watchdogs said it was not surprising that the company decided to reopen Palisades without inspecting certain facilities, especially given that they had only owned the facility for a short time.
“There are some systems that you can’t really check until you start the project,” said Rick Springman, president of Holtec. As an example, he pointed to a turbine that had to be dismantled before a thorough examination, a process that took months.
“The difference between building a new house and renovating an old house is that there is a discovery,” said Dr. Springman.
Other projects were not so demanding. Constellation Energy says it expects to restart the undamaged reactor at Three Mile Island, Pennsylvania next year, ahead of schedule. Unlike Holtec, Constellation owned and operated its plant for many years.
The palisades were purchased from Entergy, the utility company. An Entergy spokesman praised Holtec’s efforts to restart but would not comment on the condition of the plant when it was sold.
A plan to revive the Palisades, which opened in 1971, has put off some locals, including people who say they support nuclear power. Concerns range from the amount of taxpayers’ money spent and Holtec’s lack of expertise in operating nuclear reactors to cancer risks. Recent a study led by the Harvard School of Public Health found higher cancer mortality in counties near operating nuclear power plants.
“It doesn’t seem like a smart idea to try to restart something that’s that old,” said Dave Simonelli, who spends the summer less than a mile from the Palisades as the crow flies. The 69-year-old described himself as pro-nuclear, but was concerned about safety: “Why reboot an antique? A junkyard car.”
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The stockades were built at the vanguard of a booming enterprise in the United States. In the late 1970s, the country had more than 60 reactors. And by the mid-1990s, that number had surpassed 100.
However, people fell out over nuclear power after the Three Mile Island reactor partially melted down in 1979 and the Chernobyl disaster in 1986. canceled dozens of projects. One reactor after another was shut down as they struggled to compete with power plants burning natural gas, which was becoming cheaper.
By 2022, however, public attitudes toward nuclear power were improving, including Democrats who was skeptical of the technology. Nuclear reactors can produce electricity continuously without releasing greenhouse gases.
Officials working in the Biden administration and for Democratic Michigan Gov. Gretchen Whitmer tried unsuccessfully to convince Entergy to keep Palisades open. So they turned to Holtec.
It was a gamble. The company was engaged in the production of equipment for the storage of spent nuclear fuel and the dismantling of old reactors, not in the operation of power plants.
Holtec quickly estimated that reopening the Palisades would take two years and cost more than $1.9 billion, including unforeseen cost overruns, records show.
It took nearly as long to line up customers and additional financing after the Department of Energy rejected Holtec’s original request for subsidies. Holtec eventually moved the restart date to October 2025 and then to the end of this year.
Two electric cooperatives, Wolverine Power Cooperative and Hoosier Energy, agreed in 2023 to buy Palisades-produced electricity for 28 years at a fixed price. According to a Times report on Holtec’s securities, the cooperatives may have agreed to pay about $59 per megawatt hour. This is slightly higher than the market rate for wholesale electricity in the region.
Holtec and Wolverine Power declined to comment on the award. Hoosier Energy did not respond to requests for comment.
It didn’t hurt that the government showered Palisades with money, including $300 million from Michigan and the promise of federal tax breaks once the plant was up and running. Separately awarded by the Ministry of Agriculture 1.3 billion dollars to Wolverine and Hoosier in late 2024, most of which is to be devoted to that effort.
Around then, Holtec discovered a fundamental problem. The plant’s twin steam generators, which are among the most expensive equipment, were degraded more than the company expected.
Holtec plugged or repaired thousands of thin U-shaped metal tubes inside the generators. “That was a significant delay in the project, months,” said Mr Borah, the operations manager.
The Nuclear Regulatory Commission has signed off on Holtec’s approach, which activists and some residents fear is inadequate.
“There were so many trade-offs here in the Palisades,” Michael J. Keegan, co-chairman of the environmental group Don’t Waste Michigan, testified at an NRC hearing in June where he argued that Holtec should have replaced the steam generators.
Dr. Springman, president of Holtec, said the repaired device was thoroughly inspected and tested. “We feel very good about the safety of the component,” he said.
This spring, the Palisades resembled a Lego set being put back together. Scaffolding draped in orange fabric surrounded the turbines and the generator that converts the steam into electricity. Nearby, a worker was cleaning a pipe. The screen showed men in white hazmat suits inspecting a giant metal barrel designed to store nuclear fuel in a nearby reactor building.
Holtec, which is responsible for any additional expenses associated with project delays, declined to provide an updated cost estimate.
Mr Springman said it was “unfair” to describe the project as delayed, as the contractual deadline for restarting the facility is March 2027.
It’s a sensitive time for Holtec, which filed for an initial public offering this month. Armed with its Palisades experience, the company wants to build and operate smaller nuclear reactors, starting in Michigan.
It leads to a growing enthusiasm for nuclear power. The federal government, technology companies and others are offering to invest in or lend money to nuclear companies. Elsewhere, the energy crisis stemming from the war with Iran is pushing countries towards nuclear power.
Home of the plant, Van Buren County Commissioner Gail Patterson-Gladney has been too slow for the Palisades to reopen. “We’re like a prototype, something that’s never been done,” Ms Patterson-Gladney said.
Jim Wilson, 66, who lives down the road from Palisades, is adjusting to the idea of the plant coming back online. He recently purchased a Geiger counter to measure background radiation levels in his home.
“I believe they will get it right,” Mr Wilson said. “Otherwise I would have a for sale sign on the house.