Holtec knew of problems with Palisades' steam generator tubes before $1.52B loan finalized

By Tom Henry, The Blade
Published on October 5, 2024

Two days after the Biden Administration finalized a $1.52 billion federal loan to Holtec International in support of its historic effort to restart the mothballed Palisades nuclear plant, the U.S. Nuclear Regulatory Commission released a document that shows the company had conceded almost a month earlier that the number of cracks and flaws on the plant’s steam generator tubes “far exceeded estimates.”

The newly released document, made public by the NRC on Wednesday, is a summary of a Sept. 3 conference call between the federal regulator overseeing the nuclear plant and Holtec, the company that purchased it with hopes of making it the first in nuclear history to be put back into service after decommissioning had begun.

The document states that inspections to date have revealed some 1,417 indications of tiny cracks or flaws in the tubes. It states that 701 tubes in one steam generator and 248 in another are candidates for repairs or plugging.

Nick Culp, Holtec Palisades senior manager of government affairs and communications, told The Blade in a telephone interview Friday morning and in a follow-up email afterward that the company is committed to making all necessary repairs to ensure safety and that the latest information will not derail it from its timetable of getting Palisades back in operation by the fall of 2025.

Tubes that require maintenance “will get plugged or sleeved,” he said.

“Each one is unique,” Mr. Culp said of the flaws.

The company’s email emphasizes collaborations with “outside industry-leading partners” to ensure the most appropriate corrective actions are taken.

“We expected to find areas requiring additional maintenance activities during our proactive inspections and planned for this contingency,” the email states. “These findings are being addressed as part of our comprehensive restart maintenance strategy, which will require further inspections, testing, and repairs.”

But Alan Blind, who was the engineering director at Palisades from May of 2006 through February of 2013 when it was owned by Entergy, told The Blade he knows the NRC well enough to believe that the regulator won’t stand for an unlimited number of repairs.

At some point, Holtec will likely learn that its best path toward getting the NRC’s authorization for a restart would be by replacing the steam generators, a project that would cost as much as $500 million and delay restart efforts by about two years, Mr. Blind said.

He said he experienced the dilemma after he left Palisades and became a site vice president at the former Indian Point nuclear plant complex in New York. That facility eventually replaced its steam generators after trying to repair them for years.

“We’re not there yet,” Mr. Culp said when asked what it would take to make that kind of a decision at Palisades.

The NRC knows that the failure rate for steam generator tubes can increase exponentially in a short period of time, Mr. Blind said.

“It’s the rate of degradation,” he said. “You can’t prove it.”

The Sept. 3 call summary “provides a snapshot of Holtec’s findings at that time,” said Viktoria Mitlyng, NRC spokesman.

Regardless what action Holtec takes, the “stress corrosion crack indications must be appropriately addressed to maintain the generator’s pressure boundary,” she said.

“We expect to receive an analysis of the Holtec’s steam generator inspection results and a path forward to address the analyzed condition of the steam generators tubes,” Ms. Mitlyng said.

Palisades was shut down and put in its decommissioning phase in May, 2022, after more than 51 years of operation.

No plant has ever been put back into service after decommissioning began.

Holtec was hired by the plant’s previous owner, Entergy, to decommission it.

It began doing that, then switched gears and bought the plant with the intention of trying to put it back into service. Holtec applied to the U.S. Department of Energy a year ago this month for a loan to restart Palisades. It was notified last March that the Biden Administration was offering $1.52 billion and closed on the deal Monday.

Holtec has never operated a nuclear plant.

Palisades is along the Lake Michigan shoreline, about 200 miles from Toledo.

On Sept. 20, Constellation Energy Co. announced it has made a deal with Microsoft to attempt a restart of the mothballed Three Mile Island Unit 1 nuclear plant in eastern Pennsylvania. That project follows Palisades as the second effort to put a mothballed nuclear plant back into service.

In related news, the NRC staff has scheduled a 90-minute meeting for Oct. 24 with Holtec Decommissioning International to discuss resolution of an outstanding issue at Palisades. The public can view it online or in person at the NRC’s headquarters in Rockville, Md.

First Published October 5, 2024, 3:28 p.m.