September/October 2023 Issue

Also in this issue: Court Upholds Negotiated Consideration in Exchange for Agreement to Provide Extraterritorial Wastewater Service     |     Recent U.S. Supreme Court Cases – Potential Impact on Workplaces     |     Welcome Liz Leonard!

Federal Funding Opportunities for Energy Projects

Liz Leonard | 09.27.23

Over the last few years, the federal government has set aside unprecedented funding for energy infrastructure projects. The Inflation Reduction Act (IRA) and the Bipartisan Infrastructure Law (BIL) contain provisions that provide grants, loans, and tax credits that may help municipally owned electric utilities fund their next clean energy or grid reliability project.

These new laws fund the following programs and more:

• Energizing Rural America (ERA) focuses on small and rural communities. Find more information at Office of Clean Energy Demonstrations | Department of Energy;
• Grid Resilience and Innovation Partnerships (GRIP) focuses on energy grid resilience and innovation, particularly in response to extreme weather conditions. Find more information at Grid Resilience and Innovation Partnerships (GRIP) Program | Department of Energy; and
• Powering Affordable Clean Energy (PACE) focuses on clean energy infrastructure. Find more information at Powering Affordable Clean Energy PACE Program | Rural Development (usda​.gov). 

The funding is designed to support everything from small, isolated projects to large, multi-state projects.

Although most of the projects are administered at the federal level, some of the grant funding has been allocated to the states to administer. The Public Service Commission of Wisconsin (PSCW) recently met to determine how it would prioritize project applications for the funds allocated to Wisconsin for the first two years of a BIL program (see PSC docket number 9713-FG-2022). The almost 10 million dollars of grant funding is meant to support projects that reduce the length or scope of outages due to extreme weather events. The PSCW decided that it will set aside a full 75% of the funds for small utilities, a larger percentage than the federal guidelines require, and will prioritize applications for projects involving weatherization, implementation of microgrids, adaptive protection technologies, and
hardening of power systems, among other projects. The PSCW has not yet released other details about the timing or content of the upcoming grant applications. Wisconsin will receive additional rounds of funding for this program over the next three years.

In addition, the next round of energy innovation grants administered by the PSCW through the Office of Energy Innovation will soon be initiated. These grants are available to local governments and municipal utilities and support projects related to energy efficiency, renewable energy, microgrids and energy planning. Approximately $7.5 billion in BIL funding will be used to fund these grants.

As for the federally administered programs, each program has different criteria, funding amounts, application processes, and timelines. Most programs have closed their 2023 funding opportunities and have not yet opened their 2024 applications, so now is a great time to plan and prepare for future funding opportunities. In doing so, however, keep in mind that these funding programs are highly competitive and many have a rolling window of availability, so it is important to give yourselves plenty of runway to prepare the application and to seek technical assistance when needed. 

The bottom line is, if you are planning for an energy infrastructure project in the near future, particularly a clean energy project, a project that enhances resilience or grid reliability, or a project that serves a small or rural municipality, you should consider investigating these funding program opportunities, or you may be leaving money on the table.