U.S. Energy Department Implements $13 Billion Worth Grid Modernization Initiatives

The U.S. Energy Department on Nov. 18 announced $13 billion in new funding opportunities for the growth and modernization of the U.S. power grid. The Grid Resilience Innovative Partnership, or GRIP, program and the Transmission Facilitation Program, funded by the 2021 Infrastructure Investment and Jobs Act, collectively represent the largest federal direct investment in infrastructure and distribution upgrades. The federal investment is expected to help develop innovative projects that increase the reliability of the electricity grid and modernize it, so that customers and businesses across the U.S. have access to affordable, reliable and clean power.

Independent projections suggest that the U.S. has to expand electricity transmission systems by 60 percent by 2030 and may need to triple capacity by 2050, in order to swiftly  increase the supply of cleaner energy and meet higher electricity demand for electric vehicles and home appliances. The $13 billion funding, alongside a $2.3 billion program that finances grid resilience investments by states and tribes to reduce negative effects due to environmental causes, are part of the Building a Better Grid Initiative.

The Building a Better Grid Initiative, launched in January 2022, provides over $20 billion to support the modernization and building of long distance, high voltage transmission and distribution systems that are vital to reach the Biden administration’s objective of 100 percent clean power by 2035 and a carbon neutral economy by 2050.

The GRIP Program will increase grid flexibility and enhance the resilience of the electricity grid against risks of extreme weather and climate change. The program delivers projects focused on three key areas: Grid Resilience Utility and Industry Grants ($2.5 billion), Smart Grid Grants ($3 billion) and Grid Innovation Program ($5 billion). The first focus area intends to finance transmission and distribution technology solutions that will reduce multiple hazards across a region. The second is designed to increase the flexibility, efficiency, reliability and resilience of the electricity system. Concept papers for these two initiatives are due Dec. 16, 2022. The third initiative will provide funding to states and local governments to use innovative methods to transmission, storage and distribution infrastructure. Concept papers for this program are due Jan. 13, 2023. A public webinar will be held on Nov. 29, 2022.

The Transmission Facilitation Program creates a novel revolving fund to assist overcome the financial obstacles facing large scale new transmission lines, enhancements of current transmission lines and in certain states and territories, the creation of microgrids. The department announced the first solicitation under which it will use capacity contracts to commit to buy up to 50 percent of the maximum capacity of the transmission line.