Lakeshore and Manufacturing

Energy company closing nuclear power plant

December 8, 2016
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Palisades Power Plant
The Palisades Power Plant stands on a 432-acre site and generates nuclear engery. Photo via

An energy company is slated to shut down a nuclear power plant in the region that employs roughly 600 people.

Jackson-based Consumers Energy said today it has come to terms with Entergy Corporation for the early termination of Consumers’ purchase power agreement, or PPA, for energy from Entergy’s Palisades Power Plant.

Entergy also announced today its “separate, independent decision” to close the Palisades plant on Oct. 1, 2018.

Under the new agreement, Palisades will be refueled as scheduled next spring and operate through the end of the fuel cycle, then permanently shut down.

Consumers Energy will seek approval from the Michigan Public Service Commission for early termination of the PPA in 2018.

Under the original 15-year power purchase agreement, Consumers Energy was scheduled to purchase almost 100 percent of the power generated by Palisades through April 2022.

The new deal is expected to lower "costs" for Consumers customers by as much as $172 million over the early termination period from 2018 to 2022.  Consumers will also pay $172 million to Entergy for early PPA termination.

The early termination payment to Entergy will help assure the plant's transition from operations to decommissioning, maintaining its commitment to meet U.S. Nuclear Regulatory Commission requirements.

Consumers said the agreement will also allow for additional investment in clean energy, reliability and customer demand-reduction technologies, which the utility said will lead to “further customer savings.”

Consumers said conditions have changed since 2007, resulting in its decision to seek early termination of the PPA.

Those conditions include a reduction in Entergy’s "merchant footprint" and less expensive alternatives now being available to provide affordable power to the region.

Energy supply

Consumers has been very vocal over the last year about Michigan’s electric reliability needs, saying the state will not be able to meet those needs in the near future.

Patti Poppe, Consumers Energy president and CEO, said Consumers has a “comprehensive plan” to ensure ongoing reliability and affordability for its 1.8-million electric customers.

The plan includes “robust” waste-reducing energy-efficiency programs and adding more renewable energy and clean, natural gas-fired generation to the company’s portfolio.


Consumers said up to 180 “appropriately skilled employees” from Palisades could receive job placements in the ensuing years in the utility’s statewide workforce.

Leo Denault, Entergy's chairman and CEO, said Entergy “recognizes the consequences” of a Palisades shutdown for its 600 employees, but it determined the shutdown in 2018 is “prudent” when comparing the transaction to the “business risks of continued operation."

He said the company will work with employees and the community to provide support during the transition.

Filling void

Entergy and the Consumers Energy Foundation said they will provide a total of $10 million over several years in economic development funding for the southwest Michigan region.

Of the $10 million, the Consumers Energy Foundation will contribute $2 million, and Entergy will contribute $8 million.

The companies will consult with the Council of Michigan Foundations and local stakeholders as it relates to the distribution of the funds.

The process for reviewing requests for funds and distributing them will be announced later, with a focus on sustainable economic development that will broaden the community's tax base.

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