The United States Department of Agriculture (USDA) has earmarked US$236.3 million in loans to help eight states modernise and improve the reliability of rural electric systems, including smart grids.
The loans announced last week will build or improve more than 3,700 miles of line in rural areas and allocates US$20 million to smart grid infrastructure.
Agriculture secretary Tom Vilsack commented on the USDA funding: “America’s infrastructure must be modernised if we are to continue to create jobs, expand opportunity and be competitive in the global economy.
“Modernising our nation’s rural electric infrastructure will help better support economic development in rural areas while helping to ensure reliable and affordable electric service for people who live and work in small communities across the country.”
California, Florida, Georgia, Kansas, Kentucky and Indiana, North Carolina and Virgina will all benefit from the latest round of loans.
Helping rural utilities
Historically, USDA has worked with rural utilities to help bring needed infrastructure and service improvements. Under the Rural Utilities Service Programme, the USDA has disbursed loans totalling US$1.8 billion for projects across 25 states.
While the lion’s share is aimed at core grid investments such as transmission and distribution lines and power generation, about $45 million has gone to smart grid projects.
Blackouts across the US
The need to modernise the grid comes as federal data from 2013 shows that the US has more blackouts than any other developed nation with the number of outages lasting more than an hour slowly increasing over the past ten years.
The US electric grid loses power 285 per cent more often than in 1984, when data collection began, costing American businesses as much as $150 billion per year, according to the Department of Energy and the North American Electric Reliability Corp.
In 2009, the American Recovery and Reinvestment Act invested US$4.5 billion for electricity delivery and energy reliability modernisation efforts—matched by private funding to reach a total of US$8 billion— in the electric sector to begin the large task of modernising America’s ageing energy infrastructure to provide more reliable power.
Some communities have made big strides in grid modernisation, such as in Tennessee where Chattanooga’s self-healing smart grid is saving money and reducing outages.