A deal with Michigan's largest utility will result in Entergy Corp. permanently shutting down the troubled Palisades nuclear power plant in 2018, four years earlier than the New Orleans-based company could have under an earlier contract.
Entergy bought the plant from Consumers Energy in 2007. The original agreement required Consumers Energy to purchase nearly all the power the plant generated through April 2022. But market conditions have changed substantially since the purchase, with much cheaper power alternatives now available.
Consumers Energy will pay Entergy $172 million, half the $344 million the Michigan utility expects to save by buying power elsewhere over four years, for an early end to the original deal.
Assuming regulators approve, Entergy intends to shut down the Palisades plant on Oct. 1, 2018.
"We determined that a shutdown in 2018 is prudent when comparing the transaction to the business risks of continued operation," Leo Denault, Entergy's chairman and CEO, said in a statement.
The plant closure will affect about 600 workers, but Consumers hopes to place up to 180 employees into its workforce. Entergy also will provide $8 million and Consumers Energy Foundation $2 million over several years for economic development efforts in southwest Michigan.
Palisades was shut down eight times between 2012 and 2014, according to Michigan Radio. The plant shut down again in September, just days ahead of a scheduled maintenance shut down.
The plant is in Van Buren County's Covert Township, along Lake Michigan. It started generating electricity in 1971 and can produce enough power for more than 800,000 homes. Consumers Energy is part of Jackson-based CMS Energy Corp.