U.S. Department of Energy Funds to Help Strengthen APS Smart Grid With New Technology

Rhea-AI Summary

The U.S. Department of Energy (DOE) has awarded Arizona Public Service Company (APS) two grants totaling $70 million to strengthen smart grid resilience and expand wildfire prevention measures. The funds are part of the DOE's Grid Resilience and Innovation Partnerships (GRIP) program. The grants include:

1. $50 million for wildfire mitigation efforts, including upgrading electrical fuses, installing fire-resistant steel poles, expanding weather stations and fire-monitoring cameras, and building microgrids in high-risk communities.

2. $20 million for enhancing Arizona's smart, resilient grid, focusing on improving reliability in rural and tribal communities, increasing power delivery capacity, and utilizing advanced data analysis for future planning.

These projects aim to benefit APS customers, strengthen the energy grid, and support the company's commitment to 100% clean power by 2050.

Positive

• APS received $70 million in DOE grants for grid resilience and wildfire mitigation
• Projects aim to enhance energy grid safety and reliability
• Planned upgrades expected to avoid 1.2 million unplanned service interruptions over 20 years
• Initiatives target increasing power delivery capacity by up to 15% on specific transmission lines
• Grants support APS's commitment to 100% clean power by 2050

Negative

• None.

Insights

Energy Infrastructure Analyst

The $70 million DOE grant to APS is a significant boost for grid resilience and wildfire mitigation in Arizona. The $50 million for wildfire mitigation will enhance safety through upgraded fuses, fire-resistant poles and expanded weather monitoring. This proactive approach could reduce future costs from fire damage and service interruptions. The $20 million for smart grid enhancements is equally impactful, potentially avoiding 1.2 million unplanned outages over 20 years and increasing power delivery capacity by 15%. These investments align with APS's commitment to 100% clean power by 2050 and should improve reliability for its 1.4 million customers. While positive for APS's operations, the financial impact on Pinnacle West Capital Corp. (PNW) may be relative to its $9.9 billion market cap and APS's annual $2 billion infrastructure investment.

Environmental Policy Expert

This grant represents a significant step towards enhancing grid resilience in the face of climate change-induced challenges. The focus on wildfire mitigation is particularly important given Arizona's increasing fire risks. The expansion of weather stations and fire-monitoring cameras will provide valuable data for predictive modeling and rapid response. The microgrids planned for high-risk communities are an innovative approach to ensuring power continuity during emergencies. Moreover, the emphasis on integrating more clean energy resources aligns with broader decarbonization goals. The project's commitment to diverse suppliers and underrepresented communities demonstrates a holistic approach to energy transition. However, it's important to note that while these measures are progressive, they are reactive to climate change impacts rather than addressing root causes. The long-term success will depend on how effectively APS can balance grid resilience with its clean energy transition.

APS selected for $70 million in grants to increase system resilience and wildfire mitigation

PHOENIX--(BUSINESS WIRE)-- The U.S. Department of Energy (DOE) Grid Deployment Office announced it has awarded Arizona Public Service Company (APS) two grants, totaling $70 million, for projects to strengthen smart grid resilience, expand wildfire prevention and mitigation measures and help meet customers’ growing energy needs. The funds are part of the DOE’s Grid Resilience and Innovation Partnerships (GRIP) program, which is focused on enhancing and improving electric systems in rural, tribal and disadvantaged communities across the country.

“The APS energy grid spans more than 38,000 miles of power lines throughout Arizona and, for 140 years, has served customers with reliable electricity. As we plan for our state’s future, we’re also building smarter energy infrastructure that can stand strong during extreme weather and meet customers’ needs,” said Jacob Tetlow, APS Executive Vice President of Operations. “This funding, along with the approximately $2 billion a year APS invests in maintenance and upgrades, will support large-scale, innovative engineering projects designed to bolster the delivery of reliable energy our customers count on.”

Two DOE grants to benefit customers and the APS smart grid

1. Strengthening Arizona’s Wildfire Mitigation Efforts – $50 Million Grant

APS fire mitigation experts, meteorologists and field crews work year-round to protect communities, first responders and electrical infrastructure from Arizona’s growing fire risk and dry, hot summers. This grant will help fund new projects that expand APS’s industry-leading wildfire mitigation program.

Project benefits include:

• Enhancing energy grid safety by installing thousands of upgraded electrical fuses and devices to help smart grid operators make calculated, real-time adjustments to electricity distribution and perform targeted safety shutoffs. Select wooden poles in high-risk fire areas will be upgraded to fire-resistant steel poles. These measures will increase safety in communities and minimize service impacts to customers.
• Improving data-based decisions by expanding the APS network of weather stations and fire-monitoring cameras on electrical equipment, adding hundreds of devices across Arizona’s high fire risk areas and integrating more fire modeling software to enhance predictions about wildfire probability.
• Increasing reliable energy for vulnerable communities by building microgrids in two high fire risk Arizona communities. The microgrids will provide a local backup power supply during outages caused by fires and other extreme weather.
• Driving positive community impact and seeking to contract projects with diverse and underrepresented suppliers, businesses and union-represented contract employees.

This project will boost APS’s current efforts to reduce wildfire risk, which include removing hazardous brush from about 40,000 power poles each year, shielding equipment with fire-resistant mesh to protect against fire damage and collaborating with local fire agencies across Arizona to develop emergency response plans.

2. Enhancing Arizona’s Smart, Resilient Grid – $20 Million Grant

APS is building smarter energy infrastructure to increase resilience against extreme weather, address growing customer demand and integrate more clean energy resources. This grant will help fund the construction of new smart grid technology projects to increase APS’s ability to efficiently and safely reroute electricity during outage situations to improve restoration times.

Project benefits include: 

• Strengthening reliability and resilience in primarily rural and tribal communities through upgrades in energy grid technology. This will bring significant savings in repair costs and over 20 years, avoid an estimated 1.2 million unplanned service interruptions.  
• Increasing up to 15% more power delivered to APS customers through new equipment installed on specific transmission lines. This additional capacity will improve reliability, efficiency and connect more clean energy technologies to the smart grid.
• Utilizing advanced data analysis and information gathered from new technologies and smart grid devices by APS engineers and operators to track energy patterns over time and plan for future project needs.  
• Seeking to create full-time jobs targeting union-represented and underrepresented contractors. APS will also dedicate funding to its Crisis Bill Assistance program and its scholarship and workforce development initiatives.

APS serves approximately 1.4 million homes and businesses in 11 of Arizona’s 15 counties, and is a leader in delivering reliable, affordable and clean energy in the Southwest. The company is committed to serving customers with 100% clean power by 2050. As owner and operator of Palo Verde Generating Station, the nation’s largest producer of carbon-free electricity, and with one of the country’s most substantial renewable energy portfolios, APS’s current energy mix is 51% clean. With headquarters in Phoenix, APS is the principal subsidiary of Pinnacle West Capital Corp. (NYSE: PNW).

View source version on businesswire.com: https://www.businesswire.com/news/home/20241018493093/en/

Media Contact: Yessica del Rincon 480-209-8513

Website: aps.com/newsroom

Source: Arizona Public Service Company

FAQ

What is the total amount of grants awarded to APS by the U.S. Department of Energy?

The U.S. Department of Energy awarded Arizona Public Service Company (APS) two grants totaling $70 million.

How will the $50 million grant for wildfire mitigation be used by APS?

The $50 million grant will be used to upgrade electrical fuses, install fire-resistant steel poles, expand weather stations and fire-monitoring cameras, and build microgrids in high-risk communities.

What are the expected benefits of the $20 million grant for enhancing APS's smart grid?

The $20 million grant is expected to improve reliability in rural and tribal communities, increase power delivery capacity by up to 15% on specific transmission lines, and enable advanced data analysis for future planning.

How many unplanned service interruptions does APS expect to avoid with these upgrades?

APS estimates that the upgrades will help avoid approximately 1.2 million unplanned service interruptions over 20 years.

What is APS's clean energy goal mentioned in the press release?

APS is committed to serving customers with 100% clean power by 2050.