Through the Bipartisan Infrastructure Law, Congress for the first time directed funding to the U.S. Department of Energy (DOE) for the Hydroelectric Efficiency Improvement Incentives Program. The program was first authorized by Section 243 of the Energy Policy Act of 2005 but was never previously funded.

Section 40332 of the Bipartisan Infrastructure Law authorized DOE to provide $75 million in incentive payments for Section 243: Hydroelectric Efficiency Improvement Incentives Program. Owners or operators of existing hydroelectric facilities, including pumped storage hydropower, may apply for funding to make capital improvements that can improve their efficiency by at least 3%.

Application Guidance

On March 22, 2023, the Grid Deployment Office released application guidance and supporting documentation [Hydropower Facility Efficiency Increase Tool (Metric) and Hydropower Facility Efficiency Increase Tool (Imperial)] and opened the solicitation for the Hydroelectric Efficiency Improvement Incentives (EPAct 2005 Section 243). An informational webinar was held on April 5, 2023. The application window closed on June 20, 2023. DOE is now in the process of reviewing applications.

Funding Restrictions

The Bipartisan Infrastructure Law states that payments shall not exceed 30% of the costs of the applicable capital improvement. A single qualified hydroelectric facility, including pumped storage hydropower, may only receive one incentive payment from this program within a single fiscal year, and that payment shall not exceed $5 million.

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