In Michigan, a nuclear power plant acquired in 2022 by Holtec and slated for decommissioning is getting a new lease on life because of a $1.5 billion loan from the US Department of Energy’s Loan Program Office.
Meanwhile, in Tennessee, Type One Energy has announced plans to build a nuclear fusion reactor at the site of an old coal power plant with support from the Tennessee Valley Authority (the nation’s only federally owned utility), and the DOE’s Oak Ridge National Laboratory.
Across the country old coal facilities are getting a new lease on life thanks to federal and state funding opportunities to re-power aging and decommissioned infrastructure with new, zero-emission power generation and energy storage resources.
For developers of renewable power projects and energy transition innovators looking for demonstration facilities, these assets are (or should be) a prime target.
Redevelopment projects typically have existing connections to local power grids and should face fewer obstacles to planning and approval. And they slot into criteria laid out by the Department of Energy to support communities that have been most impacted by pollution associated with fossil fuel power generation.
Holtec International and the DOE
The acquisition of the Palisades nuclear power plant by Holtec International in June 2022, following its shutdown in May 2022, marked a pivotal moment in the U.S. nuclear energy landscape. And the move aimed at restarting the plant underscores a broader initiative to support the nation’s clean energy goals.
With its first commercial operation in 1971, the 805 MWe pressurized water reactor Palisades Plant was slated for decommissioning before Holtec’s intervention.
In an effort to revive the Palisades plant, Holtec International has secured a conditional loan of $1.5 billion from the U.S. Department of Energy (DOE) Loan Programs Office (LPO).
This funding is instrumental for the restart, reflecting the Biden administration’s commitment to bolstering the U.S. nuclear fleet as part of its climate strategy. The aim is not just to revive an essential power source but also to facilitate a transition towards more sustainable and carbon-free energy production.
In all, state regulators and utilities shut down 41 nuclear power plants across the US. And many of those power plants are in states which passed legislation putting a moratorium on new nuclear plant construction.
Number of new traditional nuclear plants in operation, under construction, and shutdown in the US. Image Credit: World Nuclear Association
However with energy demand rising faster than projections across the country, more local and state governments are rethinking their approach to nuclear energy.
Connecticut, Illinois, Kentucky, Montana, West Virginia, and Wisconsin have all loosened restrictions or repealed bans on adding new nuclear power. While California still will not permit the new construction of nuclear plants, a billion dollar funding package from the government is extending the life of its last remaining nuclear plant — the Diablo Canyon facility run by Pacific Gas & Electric. New Jersey, Illinois, and Connecticut more states with tight restrictions on nuclear development, have passed legislation to continue subsidizing existing nuclear facilities.
From coal plants to fusion reactors
The Type One Energy project in Tennessee is set to develop at the Tennessee Valley Authority’s (TVA) Bull Run Fossil Plant in Clinton, Tennessee. Type One Energy plans to build Infinity One, a prototype stellarator nuclear fusion reactor, at this site. A collaboration between Type One Energy, TVA, and the U.S. Department of Energy’s Oak Ridge National Laboratory (ORNL), construction of the new fusion reactor design is planned to begin in 2025.
Siting the facility on the location of a decommissioned coal plant is one way that Type One Energy could set itself up for a successful loan program application — or other government funding — in the future. Specifically through the DOE Loan Programs Office’s Title 17 Innovative Energy Projects and Energy Infrastructure Reinvestment (EIR) Projects. These projects are specifically designed with a focus on retooling, repowering, repurposing, or replacing aging or obsolete energy infrastructure. This aligns well with initiatives aimed at reusing decommissioned coal plant sites for new energy projects.
While the Type One Energy project will need to meet other requirements before its eligibility for a loan from the LPO, the ability to utilize existing infrastructure, potential for economic revitalization, and environmental remediation opportunities could all strengthen an eventual application.
Renewables and Storage Renaissance
In recent years, there has been a noticeable shift in the United States toward converting coal power plants into cleaner energy alternatives, including battery storage and natural gas facilities. This transition reflects broader efforts to pivot away from coal due to environmental and economic pressures.
Coal to Battery Storage Conversions
Several initiatives have been undertaken to convert former coal power plants into battery storage facilities, capitalizing on the existing infrastructure such as power lines and transformers to ease the integration of renewable energy sources into the grid. Notably:
- In Illinois, 11 coal power plants are set to close within the next three years, with plans to convert them into solar farms or battery storage facilities. Similar projects are underway in Louisiana, where a new solar farm is planned following a coal plant closure, and in Hawaii, a significant battery storage facility is being constructed near a former coal plant site using Tesla Megapack batteries. Other states like Virginia, Massachusetts, and Minnesota are also pursuing renewable energy projects on sites of retired coal plants.
- Xcel Energy has been proactive in this area, turning two former coal plants in Colorado and Minnesota into “long-duration energy storage” sites, employing innovative iron-air batteries made by Form Energy, Inc. This development is part of a larger trend where electrical companies are adding batteries to their renewable energy mix to ensure a continuous power supply despite the intermittent nature of sources like wind and solar.
Companies Involved
Several companies are at the forefront of these repowering initiatives:
- Xcel Energy Inc. is exploring the retrofitting of its Hayden coal plant in Colorado with energy storage that utilizes molten salt, a technology that can store up to 150 MW of electricity for at least 10 hours.
- Duke Energy Corp. is collaborating with Alphabet Inc.’s spinoff Malta Inc. to explore molten salt storage at one of its coal plants in North Carolina, indicating the potential for this technology to be scaled up across other sites.
These conversions are indicative of a larger trend towards sustainability and the recognition of the need to adapt existing infrastructure for future energy needs. The conversion projects not only help in the transition towards cleaner energy but also aim to preserve local jobs and tax revenues in communities affected by the closure of coal plants.
State and Federal Funding
Several conversions from coal power assets to battery storage facilities in the US have applied for and received state or federal grants or loans to finance their conversions.
Notably, in Illinois, a significant initiative called the Coal to Solar and Storage Initiative has been implemented, providing substantial financial support for such transitions. This program offers grant funding of up to $110,000 per megawatt of energy storage capacity, capped at $28.05 million per year. Five projects have been selected under this scheme, receiving grants to be paid out over a 10-year term. Companies like NRG Midwest Storage, LLC, and Vistra Energy have been among the beneficiaries, with the grants supporting the conversion of former coal power plants into battery energy storage facilities.
Vistra Energy, specifically, is slated to receive over $40 million in state grants to convert the E.D. Edwards coal plant in Bartonville into a battery-storage facility. This project is part of the state’s Coal-to-Solar Energy Storage Grant Program, which aims to split $280.5 million in grants among five ex-coal plants starting in 2025, when these retooled facilities are expected to become commercially operational.
Moreover, Form Energy, Inc. has partnered with Xcel Energy to deploy its iron-air battery systems at two of Xcel Energy’s retiring coal plant sites. These projects, located in Minnesota and Colorado, aim to enhance the integration of renewable energy into the system while maintaining reliability as the coal plants retire.
Form, is one of three developers of new long duration energy storage technologies (solutions which store power for ten-or-more hours) to win awards from the DOE’s Office of Commercial Energy Deployments for projects revitalizing sites on-or-near coal facilities. The others are Energy Dome, and Echogen Power Solutions.
These initiatives illustrate a growing trend of leveraging federal and state-level financial incentives to facilitate the transition from coal-powered energy generation to more sustainable and renewable energy storage solutions.
Reach out to us to see how we help businesses get the funding they need to accelerate the decarbonization solutions the world needs.