U.S. Energy Department Releases Second Loan Disbursement for 800-Megawatt Palisades Nuclear Plant

The U.S. Energy Department on March 18 announced the second loan disbursement, which released over $56.7 million of the $1.52 billion loan guarantee for the 800-megawatt Holtec Palisades nuclear plant in Michigan. The nuclear site will be the first recommissioning of a commercial nuclear reactor that had previously stopped operations. Holtec will use the funding, which the department releases through its Loan Programs Office, to restart the plant and ensure compliance with the Nuclear Regulatory Commission.

The Holtec Palisades project was one of the first nuclear projects to receive funding through the Energy Infrastructure Reinvestment program under Title 17 Clean Energy Financing Section 1706, authorized by the 2022 Inflation Reduction Act. This funding program enables developers to finance projects that revive existing energy infrastructure, such as decommissioned nuclear plants. The nuclear site, which is set to continue operations in 2025, was previously operated by Entergy Nuclear before ceasing operations in 2022.

With an increasing electricity load from AI data centers, tech companies are increasingly relying on nuclear power to meet the demand. Developing nuclear energy was a priority for the former Biden administration and remains a focus under the current Trump administration as part of a broader energy strategy that also emphasizes fossil fuels.

Reviving abandoned nuclear plants to utilize existing infrastructure and advancing small modular reactors are some of the top measures the department supports to significantly  increase domestic nuclear capacity.  In 2024, the Biden administration unveiled a roadmap to triple the current nuclear capacity by 2050. The loan disbursement also reinforces the directives in President Trump’s “Unleashing American Energy” agenda.