Holtec International said on Sept. 15 that federal regulators have authorized permanent excavation support work for two small modular reactors (SMRs) planned at its Palisades nuclear power plant in southwest Michigan, where the company is also moving the existing 805 MW facility to restart.
With approval from the U.S. Nuclear Regulatory Commission, Holtec can install the permanent walls needed to support the SMR excavations while the agency reviews its broader request for early construction work. The pending limited work authorization would cover additional site and base work before the agency issues a construction permit for the two new reactors.
Because the excavation’s retaining walls will remain buried after construction, they fall within the commission’s definition of permanent construction and required the exemption granted in late August. They will serve no function in the finished plants and will remain structurally isolated from safety-related structures after backfilling.
Diaphragm walls, soldier pile soil mix walls and perimeter shear walls would stabilize deep excavations, protect adjacent structures and utilities and manage groundwater, according to the agency. Holtec said the approval also allows for related excavation, dewatering and ground improvement work for the plant’s nuclear island, turbine island and balance structures.
Waiting for the broader authorization would “generate substantial costs” and adversely affect the construction schedule for the two small reactors, known as Pioneer units 1 and 2, Holtec told regulators. The commission found that delaying excavation support work could also delay related excavation and potentially plant operations.
This advantage carries a regulatory risk. The agency said the waiver does not require it to issue either a limited work permit or a construction permit for the two reactors, leaving Holtec to bear the risk of proceeding before those decisions are made.
Excavation will proceed in stages, with bracing installed at successive levels and monitored using inclinometers, piezometers, load cells and extensometers, according to agency documents. Because the walls will obscure the subsurface geology, Holtec has agreed to photograph and survey the exposed soils and bedrock as excavation progresses so that these conditions can be compared to the project’s subsurface model during subsequent permit reviews.
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The larger initial construction remains subject to commission approval. The pending limited work permit would allow for additional work, including soil improvement within the excavation and installation of certain foundations. A building permit would authorize the full construction of both units. The agency aims to complete its final safety assessment and environmental impact statement by March 31, 2027.
Fuel loading advances historical reset
Holtec began loading fuel into the existing Palisades reactor on Aug. 30 after more than two years of inspections, maintenance, renovation, testing and equipment upgrades, the company said. Its core of 204 assemblies includes new fuel and partially used assemblies from the plant’s final operating cycles before the 2022 shutdown.
“It’s the first in a defined progression of plant operating modes as we move through the remaining activities required for start-up,” Nick Culp, Holtec’s senior director of communications, told Michigan radio station WSJM.
Fuel loading puts Palisades in mode 6, or refueling. The plant must progress through 5-to-1 modes of operation as systems approach operating conditions, with testing, inspection, maintenance and operational readiness work continuing along the way.
The company says the restart work has included strengthening the steam generator tube, replacing control rod drive mechanism nozzles, reactor vessel inspections and other repairs and upgrades. ENR reported in January that steam generator work, turbine and generator assembly and numerous remaining inspections had pushed back the restart schedule.
No date has been announced to bring the plant, which began operating commercially in 1971, back online. A successful restart would make Palisades the first commercial U.S. nuclear reactor to return to operation after a permanent shutdown.
Under an agreement with Hyundai Engineering & Construction, Holtec plans a 10 GW North American SMR fleet starting with Pioneer 1 and 2 units in Palisades for a total of about 680 MW. ENR previously reported estimated costs of $2.1 billion to $2.7 billion per reactor.
The US Department of Energy awarded Pioneer up to $400 million in cost-shared funding last year. Holtec said in a statement at the time that federal support was an “essential enabler” to move the project from development to deployment. The company is aiming for Pioneer’s first power by 2030.
Investor Concerns, Market Sentiment, Stop IPO
Meanwhile, Jupiter, Fla.-based Holtec International postponed its initial public offering scheduled for Sept. 16, citing market conditions. The privately held nuclear equipment maker and services contractor had sought to sell 50 million shares at $15 to $18 each, which could generate $750 million to $900 million in gross proceeds.
The offering’s governance structure would have left Holtec founder and CEO Krishna “Kris” Singh firmly in control after the company went public. SEC filings show that public investors would have received Class A shares with one vote each. A holding company controlled by Singh retained Class B shares with 10 votes each.
The company’s prospectus warned potential investors that the structure would allow the holding company to control shareholder decisions, including director elections and major corporate transactions. The structure gave some potential shareholders pause, Barron’s reported, citing an investor familiar with the offering.
The offer also came as the nuclear stock market has weakened, and investors have reassessed how much they are willing to pay for future power needs tied to data center growth.
“Holtec’s investment case is clearly tied to expectations of higher electricity demand from data centers,” Lukas Muehlbauer, research associate at IPOX, told Reuters. He said demand for energy has not gone away, but investors are becoming more selective about how much they will pay for the expected growth.
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Singh described the timing to the Financial Times as Holtec running into a “perfect storm” with investor sentiment softening around artificial intelligence and data center development. He said Holtec has other options to raise capital and could return to the IPO market in three to six months, depending on market conditions.
In a Sept. 17 statement, Holtec said it plans to continue the Palisades restart, develop the Pioneer SMR-300 project plan and expand its manufacturing footprint despite postponing the offering. The company said it will consider returning to the public markets when it believes conditions are right.
