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Infrastructure Investment & Jobs Act Provides $65 billion for Energy Programs - are you ready for some contests or demonstration projects?

Russ Hissom's picture
Owner Utility Accounting Education Specialists - utilityeducation.com

Russ is the owner of Utility Accounting Education Specialists a firm that provides power utilities consulting services and online/on-demand courses on accounting, finance, FERC best-practices,...

  • Member since 2021
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  • Nov 30, 2021
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Key Takeaways

The 2021 Infrastructure Investment and Jobs Act includes $65 billion for energy projects.     

 1.         The 2021 Infrastructure Investment & Jobs Act includes $65 billion for energy programs

2.         The bulk of the funding is for demonstration projects, carbon capture, nuclear power, and smart grid investments

3.         Program funding is a variety of grants, matching grants, and tax credits

4.         Organizations should become familiar with the program requirements and how those might fit with proposed projects and business needs

 The Senate passed the 2021 Infrastructure Investment and Jobs Act (H.R. 3684) in July 2021, and the House passed a revised version in November 2021. The Act was signed into law in late November, 2021.

 The Act contains over $1 trillion in grants and loans for highways, renewable energy, rail, electric vehicles, battery storage, electric grid resiliency, and other areas. The Act includes $65 billion for energy programs.

 

Infrastructure Investment & Jobs Act energy funding focus

 The focus of funding in the energy area of the Act includes amounts for grid reliability, smart grid, nuclear power, and clean energy programs. The majority of the funding starts in fiscal years beginning October 1, 2021 – September 2022 and continues evenly in the annual federal budget until September 30, 2026. Total funding for energy programs is $65 billion.

Funding programs

Some of the specific Infrastructure Investment & Jobs Act funding items of note in these areas include:

•           Grid infrastructure and resiliency -  $5 billion (see details in our November 12, 2021 article)

•           Nuclear energy infrastructure – $6 billion

•           Hydroelectric production incentives - $800 million

•           Cybersecurity, energy security, and emergency response - $550 million

•           Smart Grid investment matching grants - $3 billion

•           Energy security program - $50 million

•           Carbon management - $7.5 billion in total

•           Clean direct air capture hubs   - $3.5 billion

•           Prizes for pre-commercial direct air capture technology prize competitions - $15 million

•           Carbon dioxide transportation infrastructure finance and innovation - $2.1 billion total

•           Clean energy demonstrations - $21.5 billion

•           Clean hydrogen hubs - $8 billion

 

While there are many other areas funded under the Act in the Division D - Energy category, the above are the major funding targets and notable items.

What's next?

 

The next step will be to become familiar with the matching grants, grants, or tax incentives included in the Act and how they may apply to your business or project needs. The majority of the funding is spread evenly over five years ending September 30, 2017. While the amounts may appear infinite, there may be a large number of applicants in specific areas, so having project plans ready as soon as possible will be to your organization's benefit. Also, having staff experienced in federal grant applications either internally or through an outside consultant will help navigate the process and help ensure that proper internal controls are in place over program applications and spending that may be audited on program completion.

 

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