The biggest RfP was for the $1.2 billion second round of the $2.5 billion Transmission Facilitation Programme (TFP), a revolving fund to help accelerate transmission buildout through capacity contracts – an approach the government says increases the confidence of investors and potential customers while reducing risk for projects.
The DOE hopes the funding will unlock billions of dollars of state and private sector capital to build ‘transformative’ projects that increase the reliability of the power grid and modernise it so “more American communities and businesses have access to affordable, reliable, clean electricity”.
US secretary of energy Jennifer M. Granholm stressed: “There’s no way around it: to realise the full benefit of the nation’s goal of 100% clean electricity by 2035, we need to more than double our grid capacity.”
DOE’s October 2023 National Transmission Needs Study estimates that, by 2035, the US must more than double existing regional transmission capacity and expand existing interregional transmission capacity by more than fivefold to maintain reliability, improve resilience to extreme weather and other disruptive events, relieve congestion, and provide access to low-cost clean energy.
Administered by the Grid Deployment Office, the TFP authorises DOE to borrow up to $2.5 billion to assist in the construction of valuable high-capacity transmission lines that otherwise would not be built, or to encourage increased capacity of already planned lines.
DOE’s capacity contracts establish the agency as an anchor customer that can provide certainty for others. The contracts commit DOE to purchase up to 50% of the maximum capacity of a transmission line. DOE will sell its capacity rights in these projects to other customers to recover its costs and ensure the revolving fund can support further projects.
This latest round, announced 6 February, follows the first $1.3 billion round issued in 2022 and completed in October 2023. The first round of TFP contracts covered three transmission lines crossing six states that will add 3.5GW of additional grid capacity throughout the US.
Round 2 is being split into two stages, with the deadline for first-stage applications set as 11 March 2024. The second stage is due to begin in May, with selected companies invited to submit more detailed proposals. Final contracts are expected to be awarded in October 2024.
At the end of February, the DOE also announced a RfP for up to $200 million of transmission projects, also funded via the TFP, to connect remote and isolated microgrids to existing infrastructure corridors in Alaska, Hawaii and US territories.
“We are moving swiftly to deliver cleaner, more affordable energy to every American community – including our remote and isolated communities of Alaska, Hawaii, and U.S. territories, who are often hardest hit by extreme weather and increasing energy costs,”
“Building transmission projects to connect isolated microgrids allows us to leverage energy resources and systems already in place to increase electric reliability and resilience for these at-risk communities,” said Maria Robinson, director of the DOE’s grid deployment office.
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