The US Department of Energy closed a $1.9 billion loan facility to restart the Duane Arnold nuclear plant.

The U.S. Department of Energy (DOE) announced the closing of a loan of up to $1.9 billion to NextEra Energy to support the restart of the Duane Arnold Energy Center in Iowa. The facility is one of three U.S. nuclear power plants receiving financial backing from the DOE’s Office of Energy Dominance Financing (EDF)—formerly known as the Loan Programs Office—to return to operation.

Duane Arnold ceased operations in August 2020 after 45 years of service. The 615-megawatt facility in Palo, Linn County, was shut down following damage from a derecho wind event, with officials concluding that repairing the plant was not economically viable. It served as Iowa’s sole nuclear power station.

The restart effort is partially driven by rising energy demand from data centers. NextEra holds a 25-year power purchase agreement with Alphabet’s Google to supply electricity to the technology company. Pending approval from the U.S. Nuclear Regulatory Commission, the facility is targeted to resume commercial operation in the first quarter of 2029.

On September 9, the DOE stated that the restart project will create approximately 1,500 construction jobs and sustain more than 450 operational positions.

“Restarting Duane Arnold is about delivering new power to meet new demand while generating billions of dollars in economic value for Iowans,” said John Ketchum, chairman, president and CEO of Florida-headquartered NextEra Energy. “Just as importantly, it shows how America can support rapid economic growth and rising electricity demand while helping keep power affordable for existing customers. By bringing new generation online to serve new demand, we can strengthen the grid, create hundreds of good-paying jobs and help ensure Iowa families and businesses are not asked to bear the costs of growth.”

Deputy Secretary of Energy James P. Daily emphasized the project’s broader impact in a Tuesday statement: “Returning 615 megawatts of reliable baseload generation will drive down electricity costs, while supporting thousands of American jobs. This administration is pursuing a comprehensive nuclear strategy, restarting existing reactors, increasing the output of our nuclear fleet, and accelerating new construction, to build the abundant, affordable, and reliable power system required for American prosperity and reindustrialization.”

Gregory A. Beard, head of the EDF, added: “Duane Arnold is exactly the kind of investment that will help restore American nuclear leadership, strengthen our energy security, and deliver the affordable, reliable power Americans need to fuel our nation’s future.”

The Iowa facility could join other previously closed U.S. nuclear sites, such as Michigan’s Palisades station and Pennsylvania’s Three Mile Island, which are being considered for restart after originally slated for decommissioning. In November of last year, the DOE finalized a $1-billion conditional loan commitment for Three Mile Island, now renamed the Crane Clean Energy Center. Constellation Energy and Microsoft have indicated they could bring the plant back online as early as next year. Financing to restart the Palisades station was finalized during the Biden administration.

When NextEra announced its power purchase agreement with Google last year, the company also disclosed definitive agreements to acquire Central Iowa Power Cooperative’s (CIPCO) and Corn Belt Power Cooperative’s combined 30% interest in the Duane Arnold plant. The transaction will make NextEra the facility’s sole owner. Under the deal, CIPCO will continue purchasing output from Duane Arnold under the same contract terms as Google.

In June, the DOE announced commitments of up to $17.5 billion to finance five utility-sponsored projects aimed at accelerating the deployment of 10 large-scale commercial nuclear reactors in the United States. The agency noted that Westinghouse will partner with up to five eligible utilities and energy companies to procure long-lead items at a fixed price. Each project will be jointly owned by Westinghouse and a utility or energy company partner.

According to the DOE, both Westinghouse and its partner must fully commit their project equity—$500 million each, totaling $1 billion per project—upfront before accessing DOE loan funds. The projects will utilize Westinghouse AP1000 reactors, each capable of producing 1.1 gigawatts of electricity. The agency aims to have the reactors under construction by 2030.

— Darrell Proctor is a senior editor for POWER.