Biden administration opens $20M for transformer, critical industrial equipment rebates

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Published on August 03, 2023 by Chris Galford

The U.S. Department of Energy this week announced $20 million in federal funding will go toward the installation of energy efficient distribution transformers and extended product systems that use equipment with electric motors, offering rebates through two programs.

The first is the distribution transformer rebate, while the second is an extended product system rebate. Both mean to help replace aging grid infrastructure with more modern tech that is affordable by comparison, as well as reliable and cleaner – all big points in Biden’s push to reduce greenhouse gas emissions. Manufacturers, utilities, Tribes, hospitals, schools and others will be able to access these funds to finance equipment upgrades.

“Today’s announcement will help more affordably upgrade distribution transformers—essential pieces of energy infrastructure that ensure electricity can move safely and reliably to homes and businesses across America—as we focus on modernizing our electric grid to meet our growing energy needs and combat the climate crisis,” U.S. Secretary of Energy Jennifer Granholm said. “President Biden’s Investing in America agenda is unleashing exciting new incentives to help replace aging grid infrastructure and modernize our electricity and industrial systems—providing critical public health and reliability benefits and lower energy costs to communities in every corner of the country.”

Qualified applicants could receive up to $25,000 in rebates. Those seeking transformer rebates will need to apply by Dec. 31, 2023, while the extended product rebate applications have not yet opened.

Distribution transformers convert high-voltage electricity generated at a variety of sites to levels safe for use by homes and businesses. The more efficient the transformer, the less energy is lost in the process, but most of the current grid runs on aged transformers. Swapping them could potentially reduce overall power consumption and emissions, cut operation costs and return lower utility bills.

On the other hand, electric motors take electrical energy and convert it into mechanical energy for a variety of processes – fans, pumps and compressors are all examples of electric motor users. Replacing this with more efficient, modern equipment could, as with transformers, reduce emissions, manufacturing and operational costs.

« Xcel Energy reveals first Clean Heat Plan, pledging to cut emissions from natural gas

NuScale Power’s Standard Design Approval Application accepted by NRC »