After much negotiation, the bipartisan infrastructure bill has become law and will help the electric sector as it continues to invest in our nation’s future grids. The $1.2 trillion Infrastructure Investment and Jobs Act includes funding that addresses energy, transportation, and water, including more than $62 billion allocated for electric and grid infrastructure. Another $47.2 billion is dedicated to resilience, including cybersecurity.
To put these amounts into perspective, the last major infrastructure legislation, the American Recovery and Reinvestment Act of 2009, allocated $4 billion for the Department of Energy to administer for “smart grid” projects — less than one-fifteenth of the total funding specifically for the DOE this time (although a specific new smart grid program is $3 billion). The total investment of all utility-scale wind, solar, and storage projects that came online in the U.S. in 2020, a record-breaking year for these deployments, was $39 billion, according to the American Clean Power Association.
The funding opportunities for public power utilities and joint action agencies cover a wide range of areas — from deploying innovative "smart" grid technology (i.e., digital networks/devices that allow more granular situational awareness) to boosting energy efficiency and weatherization programs to enabling more energy storage and deploying electric vehicle charging infrastructure. Municipalities are also specifically required to be included as states decide how to distribute more than $42 billion in broadband funding.
Increased digitization of our grids in response to customers’ needs — such as EV charging, control over their energy usage, and desire to use weather-dependent renewable sources — has the downside of increasing vectors for cyberattacks. Such risk should be managed on an ongoing basis and the new law’s increase in funding will further support the industry’s efforts to keep pace with the changing security and grid landscapes. Specifically, a provision in the IIJA requires that the Secretary of Energy carry out a program to promote and advance electric utilities’ physical security and cybersecurity, prioritizing those with fewer resources. This provision builds on the existing successful partnership between the American Public Power Association and the DOE to bring more resources, training, and cyber and physical security tools to small and medium electric utilities.
Improved infrastructure benefits the entire community. From powering essential businesses to heating and cooling our homes, we rely on electricity for nearly every aspect of our lives. As we integrate more clean energy into our electricity grids, we must ensure we continue to deliver reliable and affordable power to the people and businesses that depend on it.
Extreme weather events have also significantly affected our nation – they led to nearly $100 billion in damaged infrastructure in 2020. This infrastructure law also helps enhance our ability to respond in the aftermath of major natural disasters. Significantly, the IIJA also increases funding to the Low-Income Home Energy Assistance Program, or LIHEAP, which will help more Americans pay their energy bills, including when recovering from an unexpected weather event.
Having financial support to carry out these priorities will go a long way in helping utilities thrive into the future. But, as highlighted throughout this issue of Public Power magazine, accessing federal funds is only one piece of the picture. Financial stewardship will also require understanding how to effectively manage/execute federally funded programs, building relationships and contracts with third parties, and navigating current supply chain constraints.
APPA is ready to help our members with these challenges. We also continue to push for public power to get equal opportunity to benefit from economic incentives to move our grid forward, most notably through a direct pay refundable tax credit.
A win for public power is a win for our communities. APPA applauds members of Congress, the White House and the agencies involved, and the dedicated staff who worked to get this legislation over the finish line.