June 30 (Reuters) - The U.S. Department of Energy (DOE) is extending the application deadline for a program aimed at keeping power plants open by two months, it announced on Thursday, days after California's biggest power utility asked for more time.

The department also amended the Civil Nuclear Credit (CNC) program's guidance, revising the eligibility criteria that nuclear reactors "not recover more than 50 percent of its costs from cost-of-service regulation or regulated contracts," which could affect the eligibility of reactors applying in the first round of funds awarded, the release said, without elaborating.

“The amended CNC Guidance supports the intent of President Biden’s Bipartisan Infrastructure Law to keep the reactors online that sustain local economies and today provide our nation’s single largest source of carbon-free electricity,” Assistant Secretary for Nuclear Energy, Dr. Kathryn Huff said in a press release.

Earlier on Tuesday, power utility PG&E Corp asked the U.S. Department of Energy for a 75-day extension to the deadline to apply for federal funds that could keep its California nuclear plant open. Two reactors at PG&E's Diablo Canyon plant are scheduled to shut down in 2024 and 2025.

The first round of awards prioritizes reactors that have announced their intention to cease operations, while future CNC award cycles —to be launched in the first quarter of 2023— will not be limited to nuclear reactors that have publicly announced intentions to close down, the release said.

(Reporting by Seher Dareen in Bengaluru; Editing by Aurora Ellis)