Trump officials unfreeze $1.3B for rural co-ops to buy Michigan nuclear plant power (April 2, 2025)
Trump officials unfreeze $1.3B for rural co-ops to buy Michigan nuclear plant power
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An aerial view of Palisades Nuclear Power Plant along Lake Michigan in Covert, Michigan on Thursday, Nov. 16, 2023. Holtec International aims to bring the decommissioned plant back online in 2025, and Trump administration officials have released funding for rural electric cooperatives to purchase the entire 800-megawatt output from the plant.Joel Bissell | MLive.com
Officials with Donald Trump’s administration will unfreeze more than a billion dollars for rural electric cooperatives in Michigan and Indiana to purchase power from the Palisades nuclear plant, should a planned facility restart succeed.
The U.S. Department of Agriculture said on March 25 that several programs authorized under Joe Biden’s signature climate law, paused when Trump took office, would release funds. That includes one offering more than a half-billion dollars each in nuclear subsidies for Michigan’s Wolverine Power Cooperative and Indiana’s Hoosier Energy for Palisades’ output.
The move is another example of the Trump administration doubling down on low-carbon nuclear power, even as it pulls back Biden-era clean energy investments across the nation, seeks to boost fossil fuel production and undo environmental rules focused on combating climate change.
In mid-March, Trump’s Department of Energy said it had released funds under a $1.52 billion loan guarantee approved under Biden to help reopen the 1970s-era nuclear plant near South Haven.
The USDA grants for Wolverine and Hoosier under the Empowering Rural America, or New ERA, program now follow suit. The $9.7 billion program is a component of the 2022 Inflation Reduction Act, aimed at cutting greenhouse gas emissions while boosting reliability for rural electric co-ops.
The announcement comes with one potential catch.
The co-ops will have 30 days to voluntarily align their plans with the Trump agenda, which the USDA described as an “opportunity to refocus their projects on expanding American energy production while eliminating Biden-era (diversity, equity, inclusion and accessibility) and climate mandates.”
It’s unclear if the voluntary revisions will become mandatory conditions for receiving the money. The USDA did not respond to a request for comment.
Wolverine is still reviewing the USDA notice but doesn’t currently plan on making any changes to its proposed project, said Vice President of Communications Casey Clark in a statement. Wolverine believes in the merits of its plans as submitted, and they align with the Trump administration’s interest in strengthening reliability and affordability of domestic energy production, Clark said.
“This is a welcome and positive step. Palisades is vital to Michigan’s electric reliability and affordability,” she said.
A spokesperson for Hoosier Energy didn’t respond to a voicemail and email requesting comment.
Media and officials gather in the training control room at the Palisades nuclear plant in Covert Township, Mich., Sept. 30, 2024. U.S. Department of Energy and the U.S. Department of Agriculture deputy secretaries visited the plant to promote loans and grants for Holtec International’s effort to restart the closed nuclear plant. While some of that funding was frozen when Donald Trump took office, the agencies are now releasing it. (Garret Ellison | MLive)Garret Ellison
Some Michigan energy policy observers said the change in guidelines appears consistent with the Trump administration’s approach.
The Biden administration routinely added grant provisions requesting an outline of what DEI components would be built into project, and Trump officials seem to be asking applicants to strip that out across many programs, said Ed Rivet, executive director of the Michigan Conservative Energy Forum.
“In the end, I believe most of the grants will go out, sans a DEI component in the project,” Rivet said.
Trump USDA officials, even while releasing Inflation Reduction Act funds, have criticized the law.
“The IRA was marketed as a cure-all but delivered more bureaucracy than benefits for rural families,” said U.S. Agriculture Secretary Brooke Rollins in a statement announcing the release of the New ERA funds. “This course correction puts those investments back to work to support President Trump’s vision for energy independence and sets rural America on a path to lasting prosperity.”
The move comes after the Michigan and Indiana cooperatives and nearly 50 others that stand to benefit from Biden-era programs supporting clean and renewable energy lobbied the USDA to support the efforts, frozen as soon as Trump took office.
In letters submitted to Rollins through the National Rural Electric Cooperative Association, they said the subsidies would help offer reliable nuclear power from Palisades to 100 rural counties in Michigan and Indiana, consistent with Trump’s goal of “American energy dominance.”
Wolverine is set to receive some $650 million to buy Palisades power, with Hoosier getting nearly $675 million for electricity from the plant and other solar power, according to New ERA project summaries now scrubbed from the USDA website.
Wolverine, based in Cadillac, is a nonprofit that sells wholesale energy to six member cooperatives that service wide swaths of the Lower Peninsula.
Together with Hoosier, it has a 30-year agreement with Holtec International, the company leading the Palisades restart, to purchase its entire 800-megawatt output, enough to power 800,000 homes.
Holtec has said it hopes to bring Palisades back from decommissioning — which would be a first in U.S. history, though other plants have returned after yearslong outages — by October. It still faces permitting hurdles and the need to repair plant components.
Repowering the closed plant has drawn cheerleaders and critics, with some environmental advocates concerned about the lack of a national repository for radioactive waste, which now stays on the site of nuclear facilities. Others say nuclear carries meltdown risks, though boosters retort that incidents are exceedingly rare and safety measures extremely stringent.
A nuclear resurgence has bipartisan support at the state and federal level from Republicans drawn to nuclear power’s baseload reliability and from climate-minded Democrats drawn to its low carbon emissions.
By 2030, Holtec also has plans to open twin 300-megawatt small modular reactors, or SMRs, viewed as the next generation of nuclear technology, at Palisades.
A Monday, Sept. 30 2024 aerial view of the Palisades nuclear plant warehouse and training area. Holtec International wants to build two small modular reactors (SMRs) at this site by 2030. Rural electric cooperatives with rights to buy the power say federal subsidies give Holtec confidence in carrying out the investments.Garret Ellison
In a letter to the USDA, officials with Hoosier Energy said the cooperatives’ agreement to buy Palisades power includes rights to electricity from the SMRs, which could be some of the first of their kind in the U.S.
The federal nuclear subsidies give Holtec confidence to proceed with the plans, the co-op said.
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MLive Environmental Reporters Garret Ellison and Sheri McWhirter contributed reporting.
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