US provides $3.5bn to upgrade aging electric grid and expand capacity for renewables

The Department of Energy (DoE) on Wednesday announced $3.5bn funding for 58 projects across 44 states to help protect the aging US electric grid from extreme weather and facilitate inter-regional collaboration to expand transmission capacity for solar and wind energy.

“Today’s announcement represents the largest-ever direct investment in critical grid infrastructure, supporting projects that will harden systems, improve energy reliability and affordability—all while generating union jobs for highly skilled workers,” said Energy Secretary Jennifer Granholm.

Funded by the 2021 Infrastructure Investment and Jobs Act (IIJA), these projects are the first tranche of selections of an eventual $10.5bn available to make the grid more reliable and resilient.

Expanding transmission capacity is a critical component to achieve President Joe Biden’s ambitious goal of a carbon-free grid by 2035, as much of the country’s best renewable energy resource is either untapped or unable to get to market because of capacity constraints.

DoE claims the projects will help bring 35GW of new renewable energy online, invest in 400 microgrids, and deliver on Biden’s promise to maintain and create good-paying union jobs.

American consumers pay billions of dollars each year in higher electric bills because transmission congestion chokes off access to lower-cost sources of electricity. Congestion costs in the US have nearly doubled since 2021, according to consultancy Grid Strategies.

Bank of America estimates the US will need to spend $360bn on transmission through this decade to meet Biden’s clean energy goals, noting “aging grid infrastructure is a bottleneck for electricity demand growththat underpins a near doubling in [transmission and distribution] capital expenditure by 2030.”.