The first stage of the program is aimed at saving two plants in California and Michigan. The Biden administration wants to keep nuclear plants online because the industry generates more than half the country's carbon-free electricity.
The DOE's move came two days after two industry trade groups, Edison Electric Institute and Nuclear Energy Institute, sent a letter to Energy Secretary Jennifer Granholm requesting the extension on behalf of their members.
"We received a request to extend the application period, which could keep at-risk reactors online, delivering much needed clean energy to the grid," DOE's assistant secretary for nuclear energy, Kathryn Huff, said.
Under the plan, called the Civilian Nuclear Credit (CNC) program, owners of nuclear reactors that are scheduled to retire would get priority for the first portion of $6 billion in funding. CNC funding comes from last year's bipartisan infrastructure law.
Entergy Corp's Palisades plant in Michigan, which may be eligible, is due to shut down on May 31.
Entergy said in an email it was committed to shutting the plant after its Chief Executive Leo Denault said in an earnings call in April that there are "significant technical and commercial hurdles to changing course at this point."
However, Denault said then that Entergy would work with "any qualified party that wants to explore acquiring the plant and obtaining federal funding."
The Diablo Canyon facility in California, owned by PG&E Corp, is scheduled to fully shut in 2025. A company spokesperson said on Tuesday the utility had not yet decided whether to apply for the funds.
Environmental Working Group President Ken Cook complained that CNC was a "waste of scarce resources" and delays moving the country and California toward renewable electricity.
(Reporting by Timothy Gardner; additional reporting by Nichola Groom, editing by Jonathan Oatis and Marguerita Choy)
