The Biden administration is launching a $6bn effort to rescue nuclear power plants at risk of closing, citing the need to continue nuclear energy as a carbon-free source of power that helps to combat climate change.

On Tuesday, a certification and bidding process opened for a civil nuclear credit program that is intended to bail out financially distressed owners or operators of nuclear power reactors, the US energy department told the Associated Press exclusively, shortly before the official announcement. It’s the largest federal investment in saving financially distressed nuclear reactors.

Owners or operators of nuclear power reactors that are expected to shut down for economic reasons can apply for funding to avoid closing prematurely. The first round of awards will prioritize reactors that have already announced plans to close.

The second round will be opened up to more economically at-risk facilities. The program was funded through Joe Biden’s $1tn infrastructure deal, which he signed into law in November.

“US nuclear power plants contribute more than half of our carbon-free electricity, and President Biden is committed to keeping these plants active to reach our clean energy goals,” energy secretary Jennifer Granholm said in a statement.

“We’re using every tool available to get this country powered by clean energy by 2035, and that includes prioritizing our existing nuclear fleet to allow for continued emissions-free electricity generation and economic stability for the communities leading this important work.”

A strong majority of states – about two-thirds – say nuclear, in one fashion or another, will help take the place of fossil fuels.

A dozen US commercial nuclear power reactors have closed in the past decade before their licenses expired, largely due to competition from cheaper natural gas, massive operating losses due to low electricity prices and escalating costs, or the cost of major repairs.

This has led to a rise in emissions in those regions, poorer air quality and the loss of thousands of high-paying jobs, dealing an economic blow to local communities, according to the DoE. A quarter or more of the fleet is at risk, the agency added. The owners of seven currently operating reactors have already announced plans to retire them through 2025.

Most US nuclear plants were built between 1970 and 1990 and it’s costing more to operate an ageing fleet. The only nuclear plant under construction in the US is in Georgia. Costs have ballooned and another delay was announced in February.

The shuttered reactors include Indian Point in New York, the Pilgrim plant in Massachusetts, Fort Calhoun in Nebraska and Duane Arnold in Iowa. Entergy cited low natural gas prices and increased operating costs as key factors in its decision to close Indian Point last year. New York officials sought the shutdown, saying the plant 24 miles (39km) north of Manhattan posed too great a risk to millions of people who live and work nearby.

If reactors do close before their licenses expire, fossil fuel plants will likely fill the void and emissions will increase, which would be a substantial setback, said Andrew Griffith, acting assistant secretary for nuclear energy at DoE.

While natural gas may be cheaper, nuclear power hasn’t been given credit for its carbon-free contribution to the grid and that has caused nuclear plants to struggle financially, Griffith added.

California is slated to close its last remaining nuclear power plant, Diablo Canyon, in 2025. Officials there think they can replace it with new solar, wind and battery storage resources, though skeptics have questioned whether California’s all-in renewable plan can work in a state of nearly 40 million people.