Frequently Asked Questions on Section 242: Hydroelectric Production Incentive Program

  • Q: How, where, and when can I apply for this funding?

    The latest guidance can be accessed on the Hydroelectric Production Incentive webpage or through the Clean Energy Infrastructure Funding Opportunity eXCHANGE.

    The application period for the electricity generated and sold in calendar year 2023 closed on April 23, 2024. DOE announced the selection of 39 hydroelectric facilities for incentive payments in October of 2024.

     

    Q: How much funding is available?

    Through the Bipartisan Infrastructure Law, DOE received $125 million for the Hydroelectric Production Incentive. DOE estimates approximately $69 million will be remaining for future solicitations. Payments for this incentive are calculated based on electric energy generated and sold by a qualified hydroelectric facility during the incentive period. Please refer to the application guidance for application requirements and payment calculation procedures.

     

    Q: What are the next steps for the Hydroelectric Production Incentives?

    In 2025, the Grid Deployment Office anticipates announcing a solicitation for electricity generated and sold in calendar year 2024.

  • Q: What calendar year of hydroelectricity generated and sold is covered under this current round of funding?  

    Under the most recent solicitation, DOE accepted applications from owners and authorized operators of qualified hydroelectric facilities for hydroelectricity generated and sold in calendar year 2023.

     

    Q: Who may apply for the Hydroelectric Production Incentive, Section 242 of the Energy Policy Act of 2005?

    Any owner or authorized operator of a Qualified Hydroelectric Facility may apply for incentive payments for net electric energy generated by and sold from its facility during the eligibility window. 

    Refer to Section III. Definitions of the application guidance for additional information.

     

    Q: What is an area of inadequate electric service?

    An area in which there is inadequate electric service means a geographic area that lacks access to an interconnected electric grid; is subject to frequent electric outages, based on common reliability metrics; or where the cost of electricity is significantly above the typical residential electricity cost.

    To demonstrate a significantly high frequency of electric outages, facilities may find their utility’s reported System Average Interruption Frequency Index (SAIFI) metric without Major Event Days (MED) through EIA’s most recent Annual Electric Power Industry Reports, downloading the original zip file, and reviewing the “Reliability_202X” spreadsheet. If a facility’s utility does not have reported SAIFI metrics and the facility wishes to be considered as having a significantly high frequency of electric outages, the facility operator must contact their utility to obtain their SAIFI without MED metric.

    To demonstrate a significantly high cost of electricity, facilities may find their utility’s yearly reported average cost of retail residential electricity through U.S. Energy Information Administration’s most recent Electric Sales, Revenue, and Average Price report and referencing Table T6 “Residential Sector”.

  • Q: Do I need a Federal System for Award Management (SAM) account and Unique Entity ID (UEI)?

    Yes, a Federal SAM account and UEI are required. Additional information can be found below.

    • Create or update your Federal SAM account.
    • Entities registering in SAM.gov are assigned a UEI. The UEI is the official identifier for doing business with the U.S. Government as of April 4, 2022. Register to get started doing business with the federal government at https://sam.gov.
       

    Q: If a facility’s parent company already has a Unique Entity ID (UEI), does the facility need to apply for a UEI?

    The incentive payment is made to the owner or operator of the facility. The applicant must provide a Federal System for Award Management (SAM) account and confirm the assignment of a Unique Entity Identifier (UEI) number created in SAM.gov. The payment is made to the entity the UEI is associated with.

  • Q: How are applications processed?

    Following submission of an application, DOE performs an initial review of the application to consider the completeness of the application data and may request supplementary information relating to the application.

    DOE determines the extent to which appropriated funds are available to be obligated under this incentive. Upon evaluating each application and any other relevant information, DOE shall further determine:

    • Eligibility of the applicant for receipt of an incentive payment, based on the criteria for eligibility specified in the application guidance;
    • The number of kWh to be used in calculating a potential incentive payment, based on the net electric energy generated and sold from a hydroelectric generation facility during the application calendar year; and
    • The adjusted payment rate, as determined in accordance with the calculation set forth in Section VIII of the application guidance.

    DOE may require the applicant to conduct at its own expense and submit an independent audit, or DOE may conduct an audit, to verify the number of kWh claimed to have been generated and sold by the hydroelectric generation facility and for which an incentive payment has been requested or made. 

    Refer to Section IX of the application guidance for additional information.
     

  • Q: Is there an incentive payment cap that applies per calendar year?

    A $1 million incentive payment cap per facility applies to each calendar year for energy generated and sold during that period.

  • Q: Who should I enter as the Point of Contact (POC) for business and technical?

    Anyone within your organization may serve as the POC. You may enter the same contact for both.