Obama Administration Unveils $4 Billion In Smart-Grid Power Tech Funding

The Obama Administration Thursday unveiled a new solicitation for around $4 billion in stimulus funding for new power-transmission technology.

The Administration wants to spur development of a new artificially intelligent "smart" grid that could drastically increase the efficiency of the nation's electricity infrastructure.

The Department of Energy announced plans to distribute $3.4 billion in smart-grid technology grants and $615 million for smart-grid demonstration projects.

"We need an upgraded electrical grid to take full advantage of the vast renewable resources in this country - to take the wind from the Midwest and the sun from the Southwest and power areas across the country," said Vice President Joe Biden, making the announcement at an ABB Ltd. (ABB) transformer plant in Missouri.

By better managing electricity use and supply - particularly as the country's power infrastructure becomes more complicated as renewable energy and local generation comes online - a smart grid would help to reduce greenhouse gas emissions per kilowatt-hour of electrons consumed.

Under the $3.375 billion Smart Grid Investment Grant Program, the DOE will provide grants ranging from $500,000 to $20 million for smart-grid technology deployments, and $100,000 to $5 million for grid-monitoring devices.

Renewable and transmission companies are eagerly awaiting a new funding opportunity under the stimulus bill signed into law earlier this year, especially as investments had fizzled in the current economic crisis. The federal government approved around $60 billion in loan guarantee authority and more than $30 billion in energy grants under the stimulus bill signed into law earlier this year.

Firms such as ABB, Beacon Power Corp (BCON), Siemens AG (SI), Ambient Corp. (ABTG), and National Grid Plc (NGG) stand to gain from federal investments in the power transmission system.

Power analysts have said it would likely take several hundred billion dollars to completely modernize the power grid.

-By Ian Talley, Dow Jones Newswires; [phone]; [e-mail]