The Biden administration rejected a request from Houston’s power utility last year for $100 million to strengthen its electric poles and wires against the type of hurricane winds and flooding that knocked out power to millions of people this week, a utility document shows.
CenterPoint Energy sought the money from a new $10.5 billion Department of Energy program that is helping utilities, states and local agencies protect the electric grid from the growing threats of extreme weather and climate change.
“I don’t understand how the grant application could be rejected,” University of Houston energy economist Ed Hirs said. “This is the home of the petrochemical part of America. I mean, for God’s sakes, what’s DOE thinking?”
“A grant to CenterPoint to make the service in and around Houston more resilient is truly a matter of national security,” Hirs said.
CenterPoint has faced criticism for widespread power outages after Hurricane Beryl, a Category 1 storm, hit the area Monday morning, downing electric poles and wires across the nation’s fourth-largest metropolitan area. CenterPoint said Thursday it had restored power to more than 1.1 million homes and businesses.
But more than 1 million customers remained without electricity as the region sweltered under “extremely dangerous heat conditions,” according to the National Weather Service. A lack of air conditioning “will aggravate the risk for heat-related illnesses,” NWS said, noting that the heat index reached 106 degrees Fahrenheit on Thursday.
CenterPoint said its outages were “largely related to” damage that Beryl caused to its distribution system — the same network of poles and wires for which it sought DOE money.
It’s unclear why the department rejected CenterPoint’s request. DOE did not respond to questions. Federal departments and agencies routinely reject grant proposals because their programs have limited funds.
It’s also unclear to what extent CenterPoint would have strengthened its distribution system by the time Beryl hit if DOE had awarded the company money in October.
CenterPoint said in email Thursday, “These are highly competitive processes with applicants from around the country.” The company said it “incorporated the feedback from DOE” into a revised proposal that it resubmitted in January when the department launched a second round of funding under the $10.5 billion program.
CenterPoint disclosed DOE’s rejection in a lengthy document it submitted to the Public Utility Commission of Texas in April, describing plans to strengthen or “harden” its transmission and distribution system in the Houston area.
CenterPoint says in the document it had sought a $100 million grant through DOE’s new Grid Resilience and Innovation Partnerships Program “to fund high wind and flood mitigation projects.” It was the first time the rejection was disclosed publicly.
DOE announced the 58 projects it approved to receive a total of $3.5 billion through an initial allocation in October. It did not list the applications that were denied.
CenterPoint provides electricity to 2.8 million homes and businesses in a 5,000-square-mile area around Houston that includes major industrial ports, oil refineries and one of the nation’s largest petrochemical hubs.
“There’s such an anti-fossil-fuel initiative with the Biden administration that anything that might be remotely supporting the industry, second or third or fourth degree, gets short shrift,” Hirs said.
“CenterPoint is clearly a matter of national security,” Hirs added. “This is the communications hub for the oil patch and petrochemicals and refiners.”
The 58 projects that DOE funded are spread across the U.S., led by utilities, states and cities. The biggest grant — $464 million — went to the Minnesota Department of Commerce for transmission projects across seven Midwest states.
Other large projects are in eastern Oregon, Louisiana and Georgia. Energy Secretary Jennifer Granholm said in announcing the grants that they would enable more than 35 gigawatts of renewable energy on the grid.
One Texas utility received funding. CPS Energy was awarded $30 million to improve its grid in the San Antonio area, about 200 miles west of Houston. The DOE funds pay a portion — usually 50 percent — of the overall cost of a project.
The DOE grant program was included in the bipartisan infrastructure law enacted in 2021 that includes hundreds of billions of dollars to address climate change and its increasing threat.
After DOE rejected CenterPoint’s $100 million proposal, the company revised and resubmitted the application in January when DOE opened a second round of funding for grid resilience grants, the company said in its email. The revised proposal focuses on improving CenterPoint’s resilience to weather and on using advanced modeling to pinpoint vulnerable areas and elevating substations for flood protection.
In March, DOE “encouraged” CenterPoint to expand its initial application into a “full grant application,” according CenterPoint, which says it submitted the full application in April.
“I certainly hope CenterPoint and DOE can work together to get this underway,” said Hirs of the University of Houston.
DOE says on its website that grant recipients for the second round of grid funding will be announced later this year.
This story also appears in Climatewire.
