Grid Modernization Grant Program

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By providing grants to energy customers, e.g., local governments, education institutions and tribal governments, the program supports projects that enhance electricity reliability and affordability, among other objectives, while facilitating the integration of renewable electricity generation resources. Grid modernization projects are those that make “improvements to electric distribution or transmission infrastructure to accommodate or facilitate the integration of renewable electric generation resources with the electric distribution grid or otherwise enhance electric distribution or transmission grid reliability, grid security, demand response capability, customer service or energy efficiency or conservation.” Some potential projects are described on slide 10 of the presentation below. Grid Modernization 101.pdf Grid Modernization Grants All available funds have been committed and ECAM is no longer accepting applications in state fiscal year 2026. The Energy Conservation and Management Division (ECAM) reviewed and allocated funds to applicants for the Grid Modernization Program through the Notice of Funding Opportunity that was released September 2025. Applications were accepted November 2025 through February 2026. Municipalities and county governments, state agencies, state universities, public schools, post-secondary education institutions, and Indian nations, tribes and pueblos were all eligible to apply. All projects will take place within New Mexico. In 2025, the Community Benefit Fund was established to support projects for purposes that include reducing greenhouse gas emissions, increasing electricity from renewable energy resources, and increasing grid capacity. The State Legislature allocated $70 million from this fund to the grid modernization grant fund for the purpose of administering and supporting projects through the Grid Modernization Grant Program. Funded projects fit within one of three types. Type 1 projects are original research projects that advance the state’s understanding and appreciation of grid function, reliability, resilience, security and operation as it relates to the integration of renewable and zero-carbon resources, including impacts on customer behavior, operations and maintenance costs or the value of specific grid technologies. Type 2 projects consist of pre-construction or design activities to support grid modernization construction/installation projects. Type 3 projects involve construction, installation, operation and verification of a grid modernization technology at a project site. ECAM intends to reserve ninety percent of the available funds for Type 3 projects and five percent each to Type 1 and Type 2 projects. Technical Assistance for Eligible Entities Eligible entities and their prospective partners are encouraged to review the worksheet and sample project case studies below. These materials are designed to inform eligible entities about the grid modernization program and provide guidance on how to match local objectives with effective grid upgrades, using real-world examples. ECAM is also happy to facilitate workshops for eligible entities upon request. Grid Mod Program Summary and Worksheet.pdf BRAIN Case Study.pdf Microgrid Case Study.pdf Virtual Power Plant Case Study.pdf Grid Resilience Funding ECAM is no longer accepting proposals in state fiscal year 2026 . In addition to the Grid Modernization Grant Program, ECAM also administers the Preventing Outages While Enhancing Grid Resilience (POWER) program . POWER is funded through the federal Infrastructure Investment and Jobs Act of 2021. New Mexico will spend $20 million dollars on specific grid resilience measures including reconductoring, pole replacement, vegetation management and other measures that mitigate the impacts of climate change, extreme weather, wildfire and other natural hazards. The latest round of funding closed on January 23, 2026. Compare Grid Modernization and POWER grant programs Grid Modernization POWER Eligible Entities/Applicants Public entities Power providers/utilities Funding available ~$70 million ~$20 million Focus Innovative ways to facilitate integration of renewable energy on the grid securely, reliably and affordably Mitigation of natural hazard impacts Scope of work Applicant-generated to meet program goals and objectives Defined scopes in RFP (grid hardening measures)