Gretchen Whitmer seeks another $150M to restart Palisades nuclear plant

• Gov. Gretchen Whitmer’s budget proposal includes another $150 million  to help reopen a shuttered nuclear plant
• The proposed subsidy comes on top of $150 million approved last year
• Federal officials will soon decide whether to grant a $1.5 billion loan, part of a race to preserve carbon-free energy sources

The Palisades nuclear power plant may be in line for another $150 million subsidy from Michigan taxpayers, which would double the public commitment as state officials push to reopen the shuttered facility. 

Gov. Gretchen Whitmer’s proposed budget for the coming fiscal year recommends another $150 million to help restart the plant, which is on the Lake Michigan shoreline in Van Buren County, about 5 miles south of South Haven.

The money, which comes on top of $150 million allocated last year, would be contingent upon federal financial support for the effort to reopen Palisades. Published reports have indicated the federal government is preparing to offer a $1.5 billion loan for the plant, while considering a separate subsidy request.

Whitmer has advocated for saving the plant, which closed in May 2022 as its former owners struggled to market energy that is far costlier than wind, solar or natural gas.

Related:

• Report: Feds will give $1.5 billion to restart Palisades nuclear plant
• Fresh off Palisades closure, Michigan will study state’s nuclear prospects
• Nuclear power is having a moment in Michigan after Palisades

In a statement Thursday, Whitmer spokesperson Bobby Leddy touted the plant’s potential to bring back hundreds of “good-paying, high-skill jobs” while delivering carbon-free power to about 800,000 homes.

“We are showing the world that Michigan will be an epicenter of clean energy production and do what it takes to save jobs, protect local communities, and deliver reliable power to homes and small businesses,” Leddy said.

The effort has bipartisan support in the Legislature. But critics say Michigan is engaging in a risky bailout of what they call a failing industry and a deteriorating 52-year-old plant. 

They argue money headed toward Palisades would be better spent on renewable energy, public transit, or other initiatives to drive down fossil fuel consumption.

“It’s a joke, but it’s not funny,” said Kevin Kamps of the anti-nuclear group Beyond Nuclear. “Why don't the state and federal government just hand the keys to the Treasury over (to) this company?”

New Jersey-based Holtec International bought Palisades from its former owner, Entergy, in June 2022 with plans to make money decommissioning the facility. But the company has since shifted gears, saying it will reopen the plant if taxpayers cover costs that are expected to come to billions of dollars.

When Palisades was operational, nuclear power from the plant was, at times, 57 percent more expensive than market energy prices. But without Palisades, Michigan’s energy grid has lost 800 megawatts of carbon-free energy at a crucial time. 

If society hopes to avert the worst impacts of climate change — from floods and wildfires to disappearing winters — experts say the world must stop emitting greenhouse gasses into the atmosphere by mid-century. That requires a rapid transition away from fossil fuels like coal and natural gas. 

Losing the emissions-free power provided by Palisades was a setback. 

When operational, the plant provided about 10 percent of Consumers Energy’s peak electricity demand. Since the plant’s closure, fossil fuels have made up the difference.

The new round of proposed funding for Palisades drew skepticism from the Michigan Environmental Council, a group that in the past has supported the concept of keeping Palisades open. 

Charlotte Jameson, chief policy officer for the group, argued the Palisades money and other proposals, such as cuts to public transit funding, show that Whitmer’s proposed budget “is not prioritizing Michigan's environment and communities.”

A spokesperson for the U.S. Department of Energy declined to confirm reports that the agency is preparing to award a $1.5 billion federal loan for the Palisades restart effort, calling those reports “mere speculation.”