WASHINGTON, Sept 18 (Reuters) - The U.S. nuclear power regulator said on Wednesday that inspections found issues at the Palisades nuclear reactor in Michigan that owner Holtec wants to restart, after a two-year closure, with $1.52 billion in U.S. financing.

Holtec bought Palisades in 2022 with the intent to decommission it. But now it wants to reopen Palisades late next year amid a surge in U.S. power demand from artificial intelligence, electric vehicles and crypto currencies. It would be the first time a shuttered U.S. nuclear plant reopened.

"Preliminary results identified a large number of steam generator tubes with indications that require further analysis and/or repair," a notice on the Nuclear Regulatory Commission's website said about the two steam generators at Palisades. More analysis, testing, and repairs would occur over the next few months, it said.

Holtec said on its website that inspections of the steam generators identified "the need for additional maintenance activities."

When asked about potential additional costs or delays, Patrick O'Brien, a Holtec spokesperson, said such issues are under evaluation but the company "doesn't expect anything significant time wise" and any extra costs "would be within our scope as we planned conservatively."

The U.S. Loan Programs Office, part of the Department of Energy, issued Holtec the $1.52 billion conditional loan guarantee in March. The administration of President Joe Biden believes nuclear power is critical in the fight to curb climate change.

Alan Blind, engineering director at the plant from 2006 to 2013, estimated on Wednesday that repairs to the steam generators would cost over $500 million and add two to three years to any restart.

Edwin Lyman, a physicist and a nuclear safety expert at the Union of Concerned Scientists, said more needs to be known about the plant's condition. "The public deserves the unvarnished truth ... before more taxpayer and ratepayer dollars are poured down what could be a very deep rathole," he said.

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https://www.reuters.com/business/energy/us-regulator-says-michigan-nuclear-plant-needs-work-before-restart-2024-09-18/