Commerce announces $10.6 million in state Clean Energy Fund grants for grid modernization

Four utility projects will advance Washington state’s leading efforts in clean and renewable energy technology innovation for building a more efficient, resilient and economical power grid. 

OLYMPIA, WA – The Washington State Department of Commerce has selected four proposed electric grid modernization projects to receive grants from the Washington Clean Energy Fund.  Pending final contracts, Avista, Orcas Power and Light, Puget Sound Energy and Tacoma Power are eligible for a total of $10.6 million in state funds. Individual grants range from $1 – $3 million and grant must be matched by the utilities and their project partners at a minimum one-to-one ratio.

“Washington’s leading utilities, along with their technology partners and customers, are transforming the nation’s electric grid. With these latest grants, our state Clean Energy Fund helps them move the industry closer to a low-carbon future,” said Gov. Jay Inslee, who launched the fund in 2013.

“Clean Energy Fund investments create business opportunities and jobs, strengthening communities all across the state,” said Commerce Director Lisa Brown. “These grants are instrumental in advancing technology and systems that will ultimately make our grid more efficient, flexible and economical to operate, more reliable and resilient in emergencies.”

Customer participation is essential to the next steps in grid modernization efforts by Washington’s public and private utilities. The existing grid system has been built to handle peak loads so that power is available all the time – “on-demand.” This is neither efficient nor cost-effective because it leaves expensive power generation plants and transmission infrastructure underused during off-peak times or isolated areas out of power in emergencies. These projects will use technology to find other ways for the system to meet customer demand in a reliable and cost-effective way. More specific details will be announced as contracts are executed for each project.


  • Avista is involved in developing Spokane’s University District, including the 150,000-square-foot Catalyst Building. The building will generate the energy it uses through solar panels and other renewable energy technologies – a “net zero” design. It will be connected to an eco-district powered by a centrally located power plant. Avista’s shared energy economy pilot allows buildings to share energy resources to more efficiently generate and use energy, and to store excess energy created by the buildings for future use. This Clean Energy Fund grant will support further evaluation of this and other similar grid utilization strategies. It expands on a separate solar plus microgrid research, development and demonstration project funded in part with a $3.5 million grant in 2017. The new work will assess how this cluster of buildings performs and what infrastructure will be needed for these types of developments in the future.
  • Orcas Power & Light (OPALCO) proposes to develop a hybrid energy storage system Combined with state-of-the-art switch gear, the system will use a mix of flow (longer lasting) and lithium ion (more rapid responding) battery technology to provide rapid response and long life at moderate cost. A prior community solar project enabled with a $1 million grant from the Clean Energy Fund in 2017 was used to demonstrate a similar microgrid application on remote Decatur Island. The new project will be co-located with a community solar project (separately funded) near the Lopez Island town center, providing opportunities for customers to participate in new service programs around green energy. Additionally, OPALCO seeks to maximize economic benefit to the community and will look at a variety of other uses, including back-up power to improve outage response.
  • Puget Sound Energy is planning an innovative microgrid project in Tenino, Thurston County. PSE’s Blumauer substation will be the host site for the first utility scale solar plus storage microgrid project in PSE’s service area. In partnership with the Tenino School District, PSE will use solar power, along with new energy storage and customer load controls, to increase reliability and resilience for Tenino High School. Another battery will also be installed at the end of a distribution feeder line in the rural community, which will enable the demonstration of reliability improvement. With funding from a Clean Energy Funds grant, PSE previously deployed a battery energy storage solution to provide a variety of grid support services including back-up power to customers in the rural community of Glacier, near Mt. Baker.
  • Tacoma Power proposes partnering with a large industrial customer, to construct an 850,000-gallon liquid nitrogen storage tank for use as liquid air energy storage. It will have equivalent large capacity for a 15 megawatt/450 megawatt hour demand response. Combined with automation and control strategies, the liquefied air tank will benefit both the company and Tacoma Power by unlocking new ways to deliver the consistent, reliable, high power loads needed. This type of thermal energy storage system can provide many economic and grid benefits for utilities and their industrial customers.

Washington’s Clean Energy Fund programs support the development, demonstration and deployment of clean and renewable energy technology, including helping utilities successfully demonstrate and evaluate different types of energy storage systems on the grid. This new set of grid modernization projects shifts to studying different ways to get energy from storage and intermittent sources to where and when the customer needs it.

Since 2013, the Clean Energy Fund has encouraged public-private partnerships to invest in a diverse range of projects, leading the way in electrical grid modernization. From different battery chemistry to energy storage to microgrids and solar, Clean Energy Fund project data and business case analyses are transforming how utilities and communities view energy systems and resilience.

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