The Palisades nuclear generating station in Covert Township, Michigan.
John Madill | The Herald-Palladium | AP
COVERT, MICHIGAN — A closed nuclear plant on the shores of Lake Michigan is aiming to build the first small modular reactor in the U.S. by 2030.
The owner of the Palisades nuclear plant, Holtec International, signed a strategic agreement with Hyundai Engineering and Construction on Tuesday to build a 10 gigawatt fleet of small modular reactors in the North America, starting with two units at the Palisades site. Holtec is aiming to bring the original Palisades reactor back online in October subject to approval by the Nuclear Regulatory Commission. It would be the first restart of a closed nuclear plant in U.S. history.
Holtec’s small modular reactor design has not been licensed by the NRC yet. There are no operational small modular reactors in the U.S. Holtec is one of many companies that hope to receive approval from federal regulators to build such reactors.
Holtec’s design aims to reduce the capital costs and long construction timelines that have plagued large nuclear projects. The nuclear industry hopes such reactors will create greater flexibility in where plants can be built, and reduce construction costs by prefabricating components and then assembling them on the site.
The tech industry has shown interest in these types of reactors, with Alphabet and Amazon announcing investments in the technology last October as they search for carbon-free energy to power their artificial intelligence data centers. Alphabet and its partner Kairos Power aim to bring their first SMR online by 2030. Amazon and its partners are targeting the 2030s.
The NRC has licensed only one small modular reactor design in the U.S. so far. The designer NuScale Power tried to build the reactors in Idaho but the project was ultimately canceled in 2023 due to cost overruns.
The power industry is closely monitoring the Palisades project as a potential model to expand nuclear energy in the U.S., after years of decline, by restarting decommissioned plants and then expanding them with smaller, advanced reactor technology.
The Palisades plant permanently closed in 2022, part of a wave of reactor shutdowns as nuclear struggled to compete against cheap natural gas. Palisades started commercial operations in 1971. The plant has a generating capacity of 800 megawatts, enough to power hundreds of thousands of homes. The two 300-megawatt small modular reactors would nearly double the plant’s capacity.
Constellation Energy was following the work at Palisades before launching its effort to restart the closed Three Mile Island nuclear plant in 2028 through a power agreement with Microsoft. NextEra Energy is considering restarting the Duane Arnold nuclear plant in Iowa.
Holtec’s plans to restart Palisades, however, are running into challenges after inspections found more than 1,000 steam generator tubes with indications of corrosion cracking, according to a filing with NRC.
The number of repairs needed are higher than what Holtec initially anticipated based on the steam generator’s history, said Nick Culp, a spokesman for the company. Holtec has brought in a third-party consultant that specializes in a repair method called “sleeving,” Culp said. A liner is inserted into the damaged tubes to reinforce and seal them.
Culp said Holtec anticipates the repair work, which is subject to NRC approval, will be done midsummer. NRC staff pushed back on the company’s schedule during a Jan. 14 meeting.
Holtec’s schedule is “very, very demanding,” Eric Reichelt, a senior materials engineer at the NRC, told the company’s representatives at the meeting. Reichelt said there are only a few people available at NRC to do the work that Holtec is requesting.
“This is a very aggressive schedule,” NRC branch chief Steve Bloom told Holtec. Residents of Covert also expressed concern about the restart during the meeting.
Holtec has received a $1.5 billion loan from the Department of Energy and $300 million in grants from the state of Michigan to support the project.
