In support of the Bipartisan Infrastructure Law, the U.S. Department of Energy (DOE) is developing a $2.5 billion Transmission Facilitation Program (TFP) that will help build out new interregional transmission lines across the country. The TFP, administered through the Building a Better Grid Initiative, is a revolving fund program that will provide Federal support to overcome the financial hurdles in the development of large-scale new transmission lines and upgrading existing transmission as well as the connection of microgrids in select States and U.S. territories.

Under the TFP, DOE is authorized to borrow up to $2.5 billion through three financing tools: loans from DOE; DOE participation in public-private partnerships; and capacity contracts with eligible projects where DOE would serve as an “anchor customer.” 

On May 10, 2022, DOE issued a Request for Information (RFI) regarding the structure of the first solicitation of the program, which will be limited to applicants seeking capacity contracts for eligible projects that will begin operation no later than December 31, 2027. The initial solicitation will include a deadline for submissions, but the timing of the determination will be based on the time necessary to conduct due diligence on the proposed project.

Through the capacity contracts under this program, DOE will commit to purchasing up to 50 percent of the maximum capacity of the transmission line for up to 40 years. In doing so, DOE can reduce financial challenges by encouraging and de-risking additional investment. A goal of this program is for DOE to continue buying capacity until customer demand has increased enough to cover those costs, then DOE will remarket the capacity and replenish the fund.

DOE expects to issue another Notice of Intent (NOI)/RFI in early 2023 that will incorporate the loan and public-private partnership financing tools in addition to the capacity contracts.

DOE is requesting feedback on the proposed implementation approach for the TFP from a wide range of stakeholders. Comments can be submitted via www.Regulations.gov and are requested 30 days after publication in the Federal Register. Questions about the NOI can be sent to TransmissionFacilitation@hq.doe.gov.

A public webinar will be held on May 26, 2022, to provide additional information. Registration is required.