"Give it to us fast. Bigger projects are OK. Provide a ton of detail. Mind your CBA. Win extra points for dynamic pricing. And foot more of the bill – we'll notice that too."

On June 25, 2009, the DOE released its Smart Grid Investment Grant Program (SGIG) Funding Opportunity Announcement (FOA) (see the FOA and accompanying documents). The 57-page FOA and accompanying Appendices 1-11 describe what the DOE seeks from SGIG applicants. So what does the DOE want out of applicants?

Be timely. Although three phases of applications are contemplated (due on Aug. 6, 2009, Nov. 4, 2009, and March 3, 2010), avoid delay. "DOE cannot predict ... that funds will remain available beyond awards provided after the first due date" (p. 35). Given the current beltway brouhaha about whether the economy needs another multi-hundred billion dollar fiscal boost, the DOE will likely fund most of the $3.4 billion in SGIG grants sooner, not later.

Fear not large requests. The FOA raises the maximum "federal cost share" to $200 million, distinguishing "smaller" ($300,000 to $20 million) from "larger" ($20 million to $200 million) projects (p. 12). Well-funded applicants will welcome this news, because with the 50 percent matching requirement (p. 16), the federal government can underwrite half of a $400 million project. But "electricity consumers singly or aggregated together" (p. 13) and nascent startups may have difficulty mustering the DOE's $300,000 ante.

Call your consultants. After listing the "SGIG Topic Areas" ["Equipment Manufacturing," "Customer Systems," "Advanced Metering Infrastructure," "Electric Distribution Systems," "Electric Transmission Systems" and "Integrated and/or Crosscutting Systems" (p. 17)], the FOA uses 16 pages to detail the six sections and additional appendices comprising a complete application (pp. 17–32). [Beware, the "Project Plan ... must not exceed 40 pages" (p. 34).)] Simplified procedures for poorly heeled applicants are not immediately apparent.

Engage an economist. The FOA offers special instructions regarding the DOE's cost-benefit analysis methodology. Confuse not benefits with intermediate outcomes (p. 26). Note Table 2, which lists expected quantifiable benefits and their respective sources (p. 27).

Look for extra credit opportunities (pp. 38–43). Asset utilization and electrical reliability will enhance distribution projects. Connecting phasor measurement units to data archiving and visualization systems will be favored. Customer systems projects that aim "to improve operational performance, including improvements in energy efficiency and in reducing peak demand" will be recognized. Higher ratings can also be obtained for applications presenting, among other things, a "comprehensive, integrated approach," a "proven project manager," well-considered interoperability and cyber security frameworks, appropriate "data collection and analysis," and organizational and geographic diversity.

Make advanced metering dynamically random. "If supported by the applications submitted, DOE intends to award at least one large and up to five small projects that involve dynamic pricing combined with randomization where advanced metering infrastructure is being deployed" (p. 42).

Spend more of your money faster. Policy factors also favor projects that can be completed in fewer than three years and for which the applicant picks up more than 50 percent of the tab (pp. 42–43).

All that, and more, will be welcomed in your SGIG application.

John Kelley works with emerging cleantech and computer industry companies. He has particular interests in energy efficiency, climate change, international cooperation and intellectual property. Mr.
Kelley graduated from Stanford Law School and Swarthmore College and
 also studied at Sorø Akadamiet in Denmark. He can be reached at
[email protected].

Interact with smart grid industry visionaries from North American utilities, innovative hardware and software vendors and leading industry consortiums at The Networked Grid on November 4 in San Francisco.