Have you ever hopped on a stool only to realize that one of the legs is too short? We’ve all had that wobbly feeling at least once. It’s an uneasy feeling.
When it comes to power supply, our job is a bit like keeping a three-legged stool steady. We must balance the need for electric reliability, affordability, and managing environmental impact. When we fail to find that balance, we’re on a wobbly stool. And, unfortunately, that’s often where we find ourselves in Michigan today.
Michigan continues to rapidly retire the workhorses of our always-available electric generating fleet—coal, nuclear, and natural gas plants. We are replacing those plants with renewable resources, but they produce power intermittently and the pace at which we are building them cannot keep up with the need in our state. The reliability leg of our stool is pretty short.
We also face incredible volatility in the power supply markets due to both shrinking supply and increasing exposure to volatile natural gas prices. We’ve seen this price volatility across the U.S., with market prices ranging from almost negative to over $2,000/MWh in the last few years. The affordability leg of our stool is pretty unpredictable.
That’s why I’m pleased to share with you that our power supplier, Wolverine Power Cooperative, has entered into an agreement with Holtec International to restart the Palisades Nuclear Power Plant in southwest Michigan. Holtec will own and operate the plant; we have committed to purchasing a majority of the output of that plant on behalf of our members.
Adding this nuclear power into our power supply portfolio will shore up the three legs of our stool:
Electric Reliability
Today, Michigan is dependent on importing power from outside the state 88% of the time. When up and running, Palisades will provide enough energy to power 800,000 Michigan homes. Palisades is not only important to our co-op, but also crucial to electric reliability in Michigan.
Cost Stability
In an era of increasing price volatility, this power purchase agreement allows us to lock in stable and predictable pricing. In 2022, market energy prices were double the historic average. Without long-term power supply contracts, those market rates could have increased the average Cherryland member’s bill by $40/month. The commitment to Palisades secures future price stability and competitive rates for decades to come.
Decarbonization
We are already a leader in Michigan, powering our members with over 60% carbon-free energy today. Once Palisades resumes operation, there is the potential for us to significantly increase
our carbon-free energy supply. Our commitment to Palisades represents the foundation of our continued leadership in carbon-free energy.
Palisades offers us a unique opportunity to improve the reliability of Michigan’s grid, protect the affordability of members’ bills, and continue our efforts to lower the carbon emissions impact of our portfolio.
By committing to Palisades, we are keeping your stool stable. That’s our job— keep the lights on for you, keep your rates affordable, and keep pursuing the energy we need to serve you into the future.
Its about time something with common sense makes headway. Nuclear is the future for all the reason you noted. We now know how to do it properly and there should be no reason to take advantage of its benefits.
Carl – agree! Nuclear is such an efficient way to generate electricity. We should do more of it.
I couldn’t read any place of the date that it may start up and what are the chances that it will
The plant’s owner is projecting a return to service between late 2025 and early 2027. Much of the timeline will depend on the regulatory processes that must happen for the plant to return to operation. As part of our due diligence we worked with an outside consultant to evaluate the viability of the plant in terms of both return to service and long-term operation and nothing came up that leads us to believe it will not start back up. But, it’s something we will continue to monitor and keep our members updated on.
Define or quantify “affordable” as it relates to your opinion piece. For instance “affordable housing” is generally placed as a percentage of income. Does that hold true with affordable energy costs? I bring this up because many in our area live on fixed incomes or very little income at all. What amount is affordable for them? After decades of CEC leadership toting affordable energy, have we got something more quantifiable? Glad to see more CEC reliance on atomic energy. As with solar, wind and hydro, atomic energy can be one piece of the puzzle. None of them are perfect, but after many decades of reliance on coal, they are a breath of fresh air, literally.
Hi George – Cherryland’s electric rates are currently about 20% lower than our closest “competitor” who also serves in rural areas surrounding Traverse City. That’s how we define affordability. As it pertains to Palisades, you may notice I specifically mentioned stability. What we see in the power supply markets is increasing volatility. We have made a multiple-decade commitment to Palisades at a fixed price that is competitive. So it provides us stability which will be increasingly valuable as Michigan continues to retire our inexpensive and reliable coal and natural gas plants. As you point out, there is no perfect power generating resource but a good portfolio provides reliability and affordability while mitigating environmental impact. Affordability will always be relative but stability is not and that is what we get with this commitment. I also suspect our rates will stay competitive with other utilities while we continue to offer superior service and reliability. That’s what we’re aiming for at least. Thanks for the comment.
Thank you. It is good to know that logical, intelligent choices are being made, unlike many corporations that neglect reason in capitulation to aggressive ideologues. Nuclear is and always has been a safe, clean and reliable source of power compared to other sources, but fear mongers did their best to demonize it. Bravo to Cherryland for protecting our future.
Dave – Thanks for the kind comment. I agree with you about the importance of nuclear energy. It is efficient and effective and as you point out the most reliable form of clean energy we currently have. I’m really excited about this commitment to Palisades because the plant owner, Holtec International, is heavily invested in developing advanced nuclear technologies and small modular reactors. I expect to see those technological advancements make their way to Michigan and the Palisades site and I think that will set us up well to meet the future needs of our members.
I think nuclear power is not a good choice. What do you do with all the waste that stays dangerous for decades? Do you all remember 3 Mile Island, Chernobyl, Fukushima 2011 and Kyshtym. Until we can be sure it’s safe STAY AWAY from it.
James – you and I are in agreement that the U.S. would be wise to develop a national approach to storing nuclear waste. However, we have a long history of successfully managing nuclear waste on site while waiting for political momentum on that national solution. Fun fact: all of the spent fuel in the US that has been created over decades of operating nuclear power plants could fit in one Olympic-sized swimming pool.
As far as safe operations, there are over 200 safety systems in a nuclear plant and all will be carefully evaluated and checked before the plant’s owner, Holtec International, returns Palisades to service. The U.S. has a long history of safely operating and regulating nuclear plants and I am confident that the nuclear regulatory commission will carefully evaluate Holtec’s plans to ensure safe operation of Palisades.
Thanks for sharing your thoughts on this.
Yes, what could possibly go wrong with nuclear energy? Take your rose colored glasses off for a moment and address the comment about Three Mile Island, etc. Cheap coal was nice except for the emissions, mountaintop removal, and coal slurries That are still in evidence. I know that one of your roles is as head cheerleader for the cooperative, just as Mr. Anderson was when he was at the helm. But come on, atomic power isn’t the panacea that you paint it. Be honest and enumerate a few of its flaws. And the graphic on page 5 in Country Lines conveniently neglects to indicate how many coal mines are replaced by Palisades energy. I like the muffin recipes, though.
Thank you for communicating all the updates. Well done.
Thanks, John!
this is insanity my experience with the Fermi attempts, the decision by DTE not to go Nuclear. the fact that only one nuk plant in 20 plus years is nearing approval but not yet ready for such approval is not the point.
All scientific proof says the detrimental effect to the far upper atmosphere is way greater that any advantage nuk power will achieve! the scientific proof that the warming of the water will be detrimental to any nearby water lakes or reservoirs can not be off set. this is insane.
A month late commenting, but this seems like a sensible choice. Good work, Cherryland and Wolverine.
Fingers crossed Palisades restarts as planned.