Entergy Corp., the plant's owners, made the announcement in a news release Thursday, Dec. 8.
"Entergy recognizes the consequences of a Palisades shutdown for our approximately 600 employees who have run the plant safely and reliably, and for the surrounding community, and we will work closely with both to provide support during the transition," said Leo Denault, Entergy's chairman and chief executive officer, in the release.
"We determined that a shutdown in 2018 is prudent when comparing the transaction to the business risks of continued operation," he said.
Entergy and Consumers Energy have agreed to an early termination of their power purchase agreement for the Palisades plant, located in Van Buren County's Covert Township near South Haven, in 2018.
Entergy noted the agreement is subject to regulatory approvals. It said that "assuming regulatory approvals are obtained for the PPA termination, Entergy intends to shut down the Palisades nuclear power plant permanently on Oct. 1, 2018."
The original agreement committed Consumers Energy to purchase nearly all of the power that Palisades generates through April 2022. Under the plan now, Palisades will be refueled as scheduled in the spring of 2017 and operate through the end of the fuel cycle, then permanently shut down in late 2018.
Entergy said that since it purchased Palisades from Consumers Energy in 2007 "market conditions have changed substantially, and more economic alternatives are now available to provide reliable power to the region."
"The transaction is expected to result in $344 million in savings, $172 million of which is expected to lower Consumers Energy customers' costs over the early termination period from 2018 to 2022, and $172 million of which Consumers Energy will pay to Entergy for early PPA termination," the release said. "The early termination payment to Entergy will help assure the plant's transition from operations to decommissioning, maintaining our commitment to meet U.S. Nuclear Regulatory Commission requirements."
Palisades has long been Van Buren County's largest taxpayer and a major player in the region's economy.
Palisades is licensed by the NRC to operate through March 24, 2031. (Michigan Live, 12/8/2016)