May 26, 2022

New Grant Program Available for Gas Utilities

The U.S. Department of Transportation Pipeline and Hazardous Materials Safety Administration (PHMSA) announced Tuesday that cities operating natural gas utilities could benefit from a share of $1 billion over the next five years. The funding will come from the PHMSA Natural Gas Distribution Infrastructure Safety and Modernization Grant Program.

President Joe Biden signed the Infrastructure Investment and Jobs Act in November 2021. The act authorizes funding for municipal or community-owned gas utilities that operate as nonprofit entities. Utilities can use the funds to repair, rehabilitate, or replace natural gas distribution pipelines, acquire equipment to reduce incidents and fatalities, or avoid economic loss.

PHMSA Deputy Administrator Tristan Brown notified Gov. Andy Beshear on May 4 that Kentucky has 51 eligible utilities. Brown said PHMSA officials want to administer the grant quickly to improve safety and reduce gas leaks in those communities, which can include repairs to leak-prone and legacy distribution pipes to reduce costly methane emissions and safety incidents in underserved areas. Brown added that PHMSA notified all 51 of Kentucky’s eligible utilities about the grant opportunity.

PHMSA will consider several factors when awarding grants, including the existing pipeline’s risk profile, the potential for creating jobs, the possible benefit for disadvantaged and rural communities, and economic impact and growth. PHMSA anticipates awarding grants to applicants who have identified projects involving repairing, rehabilitating, or replacing legacy cast-iron, steel, and plastic gas distribution pipes. Applicants may also seek funds to expedite such projects as part of preexisting long-term system maintenance, repair, or upgrade plans. PHMSA will consider applications for equipment purchases if they directly enable repair, rehabilitation, or replacement of pipelines that otherwise might not get remediated.

The deadline to apply for a portion of the first $196 million round of funding is July 25, 2022. The program does not have any cost-sharing or local matching requirements.

Go here to view the notice of funding opportunity (NOFO) and to learn more.

If you have any issues accessing the NOFO, you can contact PHMSAPipelineBILGrant@dot.gov.