Regulation - What is it Good For?

Using Electric Grants for Fiber

The Infrastructure Investment and Jobs Act includes grant funding to rebuild electric grids. A smart community might be able to leverage these grants to also build some needed fiber. The following is a description of the various forms of funding for electric networks included in the infrastructure legislation.

The infrastructure legislation includes more than $15 billion in grants and another $12 billion in low-cost loans aimed at the electric grid. Just like with the broadband grant funding, this money is intended to be spent between 2022 and 2026. The federal grants will be administered by the Department of Energy. The following are some of the specific pots of funding coming available:

  • There is a $5 billion grant program aimed at grid hardening to protect the grid against extreme weather events.
  • There is a new $3 billion Smart Grid Investing Matching Grant program that is aimed at deploying technologies that enhance the flexibility of the electric grid.
  • There is $2.5 billion of funding split between a Transmission Facilities Fund and a Transmission Facilities Program, aimed at beefing up the major electric transmission routes (these are the electric grid version of middle-mile).
  • There is $6 billion for grid reliability and resilience research and development. At least $1 billion of this must be spent on rural electric grid research. The purpose of this funding is to explore innovative programs that improve transmission, distribution, and storage projects.
  • $500 million is being given to the State Energy Program that allows states to better plan and coordinate transmission and distribution.
  • Allocates $350 million to implement advanced cybersecurity technologies for electric utilities.
  • Finally, the legislation kicks off a federal process of better defining the interstate electric grid networks through better a definition of national interest electric corridors.

From everything I know about the condition of some parts of the electric grid, this doesn’t seem like enough funding. It’s certainly a lot less than what is being expended for broadband. However, there are many more billions of additional funding included in the Build Back Better Act that has passed in the House, but not yet the Senate. That bill would allocate many more billions over ten years to improve electric grids. The BBB Act also includes $24 billion in investment tax credits aimed at building at least 20 GW of high-voltage transmission lines. The BBB Act also includes a number of clean energy initiatives.

The new grant funding can be leveraged to extend fiber for a clever community.

  • The $6 billion for grid reliability research is likely going to be used for pilot projects to try innovative new technologies like cutting-edge smart grid. Part of implementing these solutions means building fiber, and there is no reason that grant-funded fiber can’t also be used for other purposes like broadband. Many know about the awesome municipal fiber network in Chattanooga, Tennessee – but many might not know the network got a kick-start from a smart grid pilot project funded by the ARRA Stimulus grants in 2009.
  • The $5 billion for hardening the grid against extreme weather is likely to be used to rebuild vulnerable pole lines or to move critical electric routes underground. Again, any electric company tackling this ought to put in fiber at the same time.
  • The same is true for the transmission fund grants – upgrading or extending transmission lines is another good time to build fiber simultaneously.

I’ve been saying for a few months that communities need to collaborate with many stakeholders to find the best broadband solution. This funding allows bringing local power utilities into the mix to fix broadband. Municipal electrics and rural electric coops are well poised to coordinate the use of this funding with other broadband efforts – and nothing will stop commercial power companies from joining in local efforts.

2 replies on “Using Electric Grants for Fiber”

You missed one, Doug =)

EPB did not get a kick-start from the Department of Energy. It was building the muni fiber network before the economy even tanked, let alone the stimulus bill was considered.

The grant they got for smart-grid did help them to complete the project faster than expected, however.

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