Connecticut Offering DG Grants

Staff -- Consulting-Specifying Engineer, 6/1/2006

Even with two new transmission lines now under construction, Connecticut is seeing electricity demand approaching its supply limits, so the state has begun a program to encourage onsite generation. Grants of $450 per kW generated—or $500 per kW in the southwest part of the state, where demand is especially high—are now available through the State Department of Public Utility Control (DPUC).

The grants are available for base-load power systems up to 65 MW, with no lower limit, and a new low interest loan program through Bank of America is available for financing these projects. Additionally, grants of $200 per kilowatt are now available for new emergency backup generating systems.

The grants will be paid by ratepayers, but DPUC officials say these costs will be offset by reductions in the fees charged to state ratepayers by the Federal Energy Regulatory Commission (FERC) because of the state's lack of adequate generating capacity. These "congestion charges" totaled more than $500 million in 2005, according to a recent Hartford Courant article on the new grants.