Transmission Facility Financing

Federal Agency

Sub-Department

Grid Deployment Office (GDO)

Purpose

To provide direct loans to non-federal borrowers for the construction or modification of electric transmission facilities.

Applicant and/or Project Eligibility Requirements

Eligible non-federally owned transmission facilities must be designated to be necessary in the national interest by the Secretary of the DOE according to the transmission studies conducted every 3 years under Section 216(a) of the Federal Power Act of 2005 in concert with affected States and Tribes.

Decarbonization Considerations

The transition away from fossil fuels to a carbon-free grid requires significant investments in transmission facilities to move electricity generated from large renewable power sources (particularly hydro and wind) to distribution networks. In addition, large-scale renewables typically require specific natural resources (solar and wind), which means that electricity may have to be transported further from the site of generation than with fossil fuels.

Equity Considerations

The construction of large-scale transmission projects is necessary to facilitate the connection of distant renewable energy sources to communities, and advocates including the Center for American Progress have long called for removing barriers to interregional collaboration, and minimizing disruption to communities with the construction of new transmission lines. Economic development activities in the areas surrounding these projects should support those affected communities, and move towards the White House Justice40 goals. Learn more here: https://www.americanprogress.org/article/advancing-equity-grid-modernization/

Helpful Tips

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Other Notes

Transmission facilities determined necessary in the national interest are set by the criteria listed in section 216(a) of the Federal Power Act.