DOE Launches $1.9 Billion SPARK Funding Opportunity To Modernize the Grid

Key Takeaways 

• The U.S. Department of Energy (DOE) has issued a $1.9 billion Notice of Funding Opportunity (NOFO) under the SPARK program (DE-FOA-0003580) to fund transmission upgrades using reconductoring and advanced transmission technologies.
• Concept papers are due April 2, 2026, full applications are due May 20, 2026, and project selections are expected in August 2026.
• DOE prioritizes projects that increase transfer capability, enhance reliability and resource adequacy, and support growing electricity demand, including demand from large new loads such as data centers and industrial clusters.
• Most applicants must provide at least a 50% nonfederal cost share; qualifying small utilities may be eligible for a reduced 25% cost share.
• Federal grants cannot be used as cost share, but applicants may combine SPARK funding with private financing, loans, and certain nongrant federal programs, subject to applicable restrictions. 

Introduction 

On March 12, 2026, DOE issued a NOFO for approximately $1.9 billion through the SPARK initiative (Speed to Power through Accelerated Reconductoring and Other Key Advanced Transmission Technology Upgrades).[1] The SPARK initiative was informed by responses to DOE’s September 18, 2025, request for information, which sought to identify novel strategies to implement four Trump administration executive orders aimed at increasing domestic energy supply and grid reliability and removing obstacles to rapid U.S. load growth.[2] This is especially critical in areas where rapid energy demand growth—driven by the explosion of energy-intensive data centers, AI facilities, and emerging advanced manufacturing—is outstripping grid and generation capacity.[3]  

The NOFO concentrates on transmission capacity expansion through reconductoring; advanced transmission technologies that can increase the usable capacity of existing assets in real time; and large-scale, cross-regional transmission upgrades and coordinated planning. The first step in applying for an award is submission of a six-page maximum concept paper due April 2, 2026. Following DOE review, selected concept paper applicants will be invited to submit full proposals. Awards are anticipated in August 2026. 

Potential applicants should be aware that several required registrations may take several weeks to process—early initiation is imperative.[4] 

Program Summary and Key Themes 

In launching SPARK, DOE signals its intent to prioritize projects that can deliver measurable near-term gains in grid transfer capability, reliability, and resource adequacy. The program gives particular weight to rapid reconductoring and upgrades that can achieve at least a 50% increase in transfer capacity and unlock access to stranded generation or high-growth demand centers, such as new industrial corridors and data hubs. DOE emphasizes operational and physical improvements that use existing rights-of-way to reduce electricity congestion and lower customer costs. Novel elements in this round include a sharper focus on projects that deliver “dispatchable” reliability and documented resource adequacy—responding directly to recent reports identifying national supply risks. 

Topic Areas 

• Topic Area 1: Grid resilience. ($427 million | 5–10 awards | $10 million–$100 million per award). Supports projects that strengthen grid reliability and resilience through reconductoring and deployment of other advanced transmission technologies. Projects must expand the transfer capability of existing transmission or sub-transmission lines, improve system flexibility, and reduce the likelihood and consequences of disruptive events. Eligible approaches include reconductoring with advanced conductors, dynamic line rating, advanced power flow control, topology optimization, and flexible transformers. Applicants must also submit a Report on Resilience Investments describing prior and planned investments to reduce grid disruptions.

Eligible applicants include a broad range of domestic entities, such as for-profit and nonprofit organizations, institutions of higher education, state and local governments, and Indian tribes. 

• Topic Area 2: Smart grid. ($614 million | 25–40 awards | $10 million–$50 million per award). Focuses on deployment of market-ready technologies that enhance monitoring, automation, and control of the electric grid. DOE is particularly interested in projects deploying advanced digital and operational tools—such as dynamic line rating systems, real-time monitoring, advanced sensors and communications networks, and grid optimization software—that improve situational awareness and operational flexibility. Reconductoring is eligible under this topic area only when it directly supports smart grid functionality.  

Eligible applicants include a broad range of domestic entities, such as for-profit and nonprofit organizations, institutions of higher education, state and local governments, and Indian tribes.[5]  

• Topic Area 3: Grid innovation. ($862 million | 3–8 awards | $100 million–$250 million per award). Supports high-impact, large-scale, multijurisdictional projects designed to expand transfer capability between transmission-planning regions and enable new large loads. Required partnerships among states, tribes, utilities, independent system operators (ISOs), regional transmission organizations (RTOs), and regional planners are essential. Applications must provide detailed cross-regional modeling demonstrating improvements in transmission capability, reliability, or operational efficiency, a meaningful level of collaboration among entities, and sufficient project detail.  

Eligible applicants are limited to states, combinations of states, Indian tribes, units of local government, and public utility commissions. 

Foreign Entities 

Foreign entities are generally ineligible but may seek a DOE waiver.[6] Foreign entities of concern (as defined by DOE),[7] debarred parties, certain nonprofits engaged in lobbying, and National Laboratories/Federal Funded Research and Development Centers are explicitly excluded from participation as prime recipients.  

Cost Share and Financing Considerations 

Most applicants must contribute at least a 50% nonfederal cost share.[8] Applicants may potentially combine SPARK funding with private capital, project financing structures, or certain federal loan programs, subject to applicable restrictions. Applicants should also evaluate how SPARK funding interacts with state incentives or utility rate-based investment mechanisms when structuring their financing.[9] 

DOE Evaluation 

Applications are evaluated against four weighted criteria: technical approach and impact (40%), financial and market viability (20%), management and organization (20%), and workplan (20%). Within these criteria, DOE prioritizes projects with strong technical merit that deliver substantial new transfer capability, reduce system costs, and present clear, replicable value at a regional scale. 

Strengthening an Application 

Project Readiness 

• Demonstrate a clear path to rapid implementation. Proposals should present a credible timeline supported by a comprehensive work breakdown structure; an integrated project schedule with actionable go/no-go milestones;[10] and delineate key procurement, construction, permitting, and interconnection activities, including risk factors that could affect timelines.
• Detail risk management strategies. Applicants should include a risk management plan identifying technical, permitting, security, environmental, and organizational risks, with detailed mitigation strategies for each, and highlight the team’s prior experience managing large infrastructure projects and navigating regulatory, supply chain, and permitting delays.
• Document project permitting and procurement steps. Applicants should show that they have proactively addressed regulatory requirements and have a credible path to permits, site control, and environmental clearance. Where possible, applicants should show they have begun or completed required activities—or have clear agreements in principle. Projects that use existing transmission corridors or rights-of-way should highlight this advantage explicitly, as it signals faster deployment and fewer permitting hurdles. 

Stakeholder Engagement 

• Build broad stakeholder relationships early. Early engagement with transmission owners, utilities, RTOs, or ISOs can strengthen a proposal by demonstrating operational feasibility and alignment with regional planning processes. Outreach to state regulators, local governments, tribal governments, affected communities, and labor or workforce partners can add competitive weight to an application. Applicants are advised to address potential community, landowner, or environmental concerns in the risk management plan. 

Measurable Grid Impact 

• Quantify expected improvements. Proposals should set forth detailed, measurable outputs—such as increases in transfer capacity (MW/MWh enabled), congestion relief, and the ability to serve new loads (including data centers, industrial clusters, and manufacturing corridors).
• Emphasize replicability and regional scalability. Describe how your approach can be replicated and how this project will inform or enable larger-scale grid modernization, along with potential sources of cost reductions for future projects and estimates of Nth-of-a-kind costs.
• Address resource adequacy and reliability. Projects that bolster dispatchable resource adequacy, system reliability, and grid resilience—particularly in high-load or vulnerable regions—will score highly. If a project involves any nondispatchable generation, the proposal must specifically address how resource adequacy and grid balancing are maintained. 

Environmental, Regulatory, and Permitting Requirements 

• Tribal consultation and impacted Indian tribes. Any project that potentially impacts Indian tribes—including impacts on tribal resources or reserved rights that extend beyond tribal lands—requires dedicated documentation of support from the relevant Indian tribes at the time of application submission. Any outreach, assessment of impacts, and mitigation plans must be documented and made available to DOE upon request after award selection and/or during award negotiation.[11]
• National Environmental Policy Act (NEPA) and environmental review. All awards are subject to environmental review under NEPA, which may require preparation of environmental assessments or environmental impact statements depending on project characteristics.[12] Applicants must complete DOE’s Environmental Questionnaire as part of the full application.[13] Applicants should carefully consider and should seek legal counsel or other expert advice before taking any action related to the proposed project that would have an adverse effect on the environment or limit the choice of reasonable alternatives prior to DOE completing the NEPA review process.
• Permitting strategy and regulatory pathway. Proposals must include a detailed description of all required state, local, tribal, and federal permits with a realistic timeline for securing them. Applicants should proactively identify third-party or governmental approvals needed (e.g., interconnection agreements, right-of-way permits, and state public utility commission approvals) and demonstrate progress toward securing them.  
• Funding restrictions. Applicants must be aware of both program-specific and standard funding restrictions.[14] For example, awards involving construction, alteration, maintenance, or repair of public infrastructure are subject to Build America, Buy America (BABA) Act requirements under the Infrastructure Investment and Jobs Act.[15] The Davis-Bacon Act also applies to all awards, requiring payment of prevailing wages on covered construction activities.[16]
• Security and supply chain considerations. During the award negotiation phases, applicants for Topic Areas 2 and 3 must address cybersecurity protections for grid monitoring and control systems, protection of sensitive energy infrastructure information, and supply chain risk management for critical grid components.[17] DOE expects applicants to demonstrate that proposed technologies and suppliers comply with applicable federal cybersecurity and infrastructure protection standards and that project designs incorporate appropriate safeguards against both physical and cyber threats.[18] 

Conclusion 

The SPARK NOFO represents a targeted federal effort to accelerate near-term transmission capacity expansion using deployable, existing infrastructure solutions. Successful applicants will need to pair technical ambition with disciplined execution, demonstrating not only what their projects can achieve, but how quickly and credibly they can be delivered. 

With a compressed application timeline and significant threshold requirements, prospective applicants should move quickly to confirm eligibility, initiate required registrations, and align key partners while advancing permitting, cost share structuring, and risk management strategies. Interested parties should swiftly review eligibility, immediately initiate SAM.gov and other registrations, and engage partners to shape compelling proposals. Questions regarding this NOFO must be submitted to DE-FOA-0003580@netl.doe.gov no later than three business days before the application due date and time.[19] 

Endnotes

[1] Funding for the SPARK initiative comes from the Infrastructure Investment and Jobs Act (IIJA). NOFO Part 1 describes the DOE program goals and evaluation criteria, eligibility, and other components for each funding opportunity, including concept papers and applications. NOFO Part 2 includes the fixed DOE requirements that generally do not change from NOFO to NOFO, including standard information for the application phase, expectations for award negotiations, and post-award requirements.

[2] Exec. Order 14154: Unleashing American Energy (Jan. 20, 2025); Exec. Order 14179: Removing Barriers to American Leadership in Artificial Intelligence (Jan. 23, 2025); Exec. Order 14262: Strengthening the Reliability and Security of the United States Electric Grid (April 8, 2025); and Exec. Order 14302: Reinvigorating America’s Nuclear Industrial Base (May 23, 2025).

[3] More information on the RFI is provided in our September 24, 2025, blog post. 

[4] These include SAM.gov, Grants.gov, and eXCHANGE. NOFO Part V.A and B and NOFO Part 2, Section V provide information about these requirements and how to register.

[5] Projects dependent on certain federal tax credits or deductions for Smart Grid equipment, or routine operational and maintenance expenses, are not eligible.

[6] See NOFO Part 1, sections II.A.2 for Domestic Entity for qualifications of domestic entity eligibility and II.A.3 Foreign Entity Participation. If the prime applicant and/or subrecipient do not meet the qualifications for a domestic entity, then the applicant must submit an explicit waiver request in the application. Detailed information regarding waivers are found in NOFO Part 2, section 4.B.8 & 9.

[7] 89 Fed. Reg. 37079 (May 6, 2024).

[8] Small utilities (selling no more than 4,000,000 MWh/year) may qualify for a reduced 25% cost share.

[9] Note that certain Smart Grid investments under Topic Area 2 may be ineligible if they rely on specific federal tax credits or deductions. Applicants should carefully consider how proposed projects interact with federal tax incentives when structuring project financing and cost share.

[10] See NOFO Part 1, Section VIII, Award Administration Information Requirements.

[11] Detailed information regarding tribal engagement is set forth in NOFO Part 1, Section IV.D.3.

[12] U.S. Department of Energy NEPA Implementing Procedures (June 30, 2025). 

[13] The template for the environmental questionnaire is found on eXCHANGE.

[14] Program-specific statutory requirements are set forth in NOFO Part 1, Section IV.F. NOFO Part 1 and NOFO Part 1, Section VIII.A set forth post-award requirements and administration. To better understand post-award requirements and administration, applicants should review the Standard Award Terms and Conditions, the sample Federal Assistance Reporting Checklist, and standard Intellectual Property (IP) Provisions.

[15] NOFO Part 1, Section IV.F.1. Note that this requirement does not apply to prime recipients that are for-profit entities. All iron, steel, manufactured products, and construction materials used in the project must be produced in the United States.

[16] See NOFO Part 2, Section IV.D.6. 

[17] See NOFO Part 1, Section VIII.A.3. Supplementary guidance on the cybersecurity plan requirement is available here. 

[18] IIJA Section 40126. 

[19] All questions and answers related to this NOFO will be posted on the eXCHANGE site.