Biden administration to invest $2.2 billion to modernize nation’s energy grid

President Joe Biden’s administration and the Department of Energy (DOE) announced a $2.2 billion investment Tuesday to strengthen the nation’s power grid to make it more resilient to extreme weather events and facilitate the transition to cleaner energy sources.

According to the Associated Press (AP), the investment will finance eight projects in 18 states to meet growing energy demand.

Additionally, the investment will enable the construction of more than 600 miles of new transmission lines and the modernization of approximately 400 miles of existing lines, enabling the lines to handle increased electricity loads.

The DOE said the investment represents the largest-ever direct financial injection into the nation’s power grid, which is expected to provide reliable, affordable electricity to 56 million homes and businesses, the AP reported.

“They will help us meet the needs of electrified homes and businesses, new manufacturing plants and all of those growing data centers that are putting demands on the grid,” Energy Secretary Jennifer Granholm said in a news call to announce the funding, according to the AP.

Newsweek contacted the Energy Department by email on Tuesday seeking comment.

Granholm spoke about what she described as the urgent need for the initiative, citing the increasing frequency of extreme weather events caused by climate change that are damaging energy infrastructure and causing widespread power outages.

The investment represents the second round of funding from the $10.5 billion Grid Resilience and Innovation Partnerships program, which was established in the bipartisan 2021 infrastructure law. Additional project announcements are expected later this year in states including California, Virginia, South Carolina, Montana and North Dakota.

The decision comes as many utilities are grappling with rising electricity demand as Americans electrify more appliances and cars, data centers draw more power, and more manufacturing moves back to the U.S.

“We are seeing a huge amount of movement and recovery of critical minerals processing, battery production,” said Jigar Shah, director of the Energy Department’s Office of Lending Programs. Newsweek for the previous story.

Shah added that more than 600 new or expanded manufacturing plants have been announced since Biden took office and said those plants will need power.

“So the question is how do we put them together, and do we want to do it in the most expensive way possible — which is kind of the default — or do we want to do it in a cheaper way?” Shah said.

Meanwhile, Max Luke, director of business development and regulatory affairs at cleantech firm VEIR, praised the new investments but noted that much work remains. In comments to the AP, he stressed that while these steps are significant, much more capacity will be needed to achieve deep decarbonization and net-zero emissions goals.

“If you look at the scale of the challenge and the amount of grid capacity needed to achieve deep decarbonisation and net zero emissions, this is a drop in the ocean,” Luke said.

The AP also reported that a Princeton University study, “Net-Zero America,” suggests the U.S. will need to increase electricity transmission by about 60 percent by 2030 and possibly triple that by 2050 to meet those goals.

The $2.2 billion investment is just one example of the Biden administration’s efforts to transition to clean energy while meeting energy demand. Perhaps most significantly, President Biden signed the Inflation Reduction Act (IRA) into law in 2022. This landmark legislation offers historic levels of support for a range of clean energy projects, including solar and wind installations, electric vehicle and battery manufacturing, electric vehicle charging infrastructure, and home energy efficiency improvements.