The U.S. Department of Energy has finalized a $1.52 billion loan agreement to restart operations at the Palisades Nuclear Power Plant in Michigan, part of the state's goal to produce all its energy from clean sources by 2040.

The project has also received a $1.3 billion grant from the United States Department of Agriculture and $300 million allocated from the state’s 2025 budget.

“Reopening Palisades will keep energy costs low, shore up domestic energy production, and secure Michigan’s competitiveness for future economic development,” Gov. Gretchen Whitmer announced. “We will lead and build the future here in Michigan with the strongest clean energy labor standards in the nation, and tools to build more renewable energy faster. Let’s keep getting it done.”

In May 2022, the Palisades plant was shut down and sold the next month to Holtec International, leaving the state with two operating nuclear power plants, Fermi and Donald C. Cook. If successful, Palisades would become the first successfully restarted nuclear power plant in American history.

The project has involved work by the state, the Michigan Legislature, Wolverine Power Cooperative, and Holtec. Once operating, the plant is expected to generate enough electricity to power 800,000 homes.

“Michigan needs more clean energy production to meet our decarbonization goals,” state Rep. Joey Andrews, D-St. Joseph, said. “I am proud to see Southwest Michigan lead the nation as the first to restart a nuclear power plant with the reopening of Palisades. This historic achievement ensures we are advancing our economy, providing Michiganders with high-paying job opportunities and making strides toward our clean energy goals.”

According to a 2023 study from the Economic Growth Institute at the University of Michigan, the shutdown of the plant led to a loss of $259 million annually for the region. Reopening the plant would provide an estimated $40 million in annual tax revenue.

Nuclear energy provided 30% of the state’s electricity in 2021, according to the U.S. Energy Information Administration statistics.