Stimulus Funding Questions Abound

TERESA HANSEN

Editor in chief

At the recent Edison Electric Institute’s annual conference and expo, I attended a session titled “Seizing Stimulus Opportunities,” hoping to learn how much stimulus money is available for energy projects, what companies must do to receive funding and when the funds will be available. I learned, however, that no clear answers to these questions exist.

The panelist said that $50 to $80 billion of stimulus money is available to the industry. The $30 billion range in the available amount illustrates that details about the funding are unclear. Some $39 billion is reportedly allotted for energy efficiency programs and projects, which is not available to utilities but to electricity consumers for things such as weatherization projects and rebates. In addition, $27 to $30 billion is said to be available for renewable energy projects. The remaining amount will fund smart grid advancement, transmission projects, and research and development in areas such as clean coal, carbon capture and sequestration, and energy storage.

The applications guidelines are unclear. Tom Schneider from the National Renewable Energy Laboratory’s office of energy efficiency and renewable energy, who represented the Department of Energy (DOE) on the panel, said DOE can’t comment on the application guidelines and criteria because they haven’t yet been defined. When asked how utilities are to comply with the July 29 application deadline without guidelines, Schneider had no answer.

Even more questions about smart grid funding exist. The DOE has said that interoperability standards must be defined before it will release stimulus money for smart grid projects. A committee has been created to define the standards (see page 10 for more on standards development) but much work remains to be done. Schneider said that “smart grid activity is moving forward as rapidly as possible” but he couldn’t say when the standards will be ready or how the DOE will select smart grid projects before they are in place.

Many industry insiders believe it will take years to define these standards. In the meantime, rumor is that some utilities have put their planned smart grid projects on hold. Some are waiting until the standards are identified because they don’t want to learn that they selected technology that may soon be obsolete. Others plan to apply for stimulus funding and are waiting to see how much money they will receive before they proceed with their projects.

Schneider said the No. 1 purpose of the stimulus funding is to “move money into the economy to respond to the financial crisis.” The second objective is to get quality results, he said.

In this instance, the administration’s plan may have the opposite effect, at least in the short term. And, if the stimulus money does begin to flow and projects begin to move forward, with so many unanswered questions, there is a good chance the second objective will not be met. One panel member said it is difficult to spend money both fast and wisely. I agree.

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