Electric Grid Modernization Grant Program

The Grid Modernization Grant Program is administered by the Energy Conservation and Management Division (ECAM) of the Energy, Minerals and Natural Resources Department (EMNRD) in the State of New Mexico. This initiative was established under the authority of the Grid Modernization Roadmap Act of 2020 and is governed by 17.9.588 NMAC. The program supports the state's transition to 100 percent zero-carbon electricity by funding research, design, and implementation projects that enhance electric grid functionality. Grid modernization includes improvements to distribution or transmission infrastructure and efforts to accommodate renewable resources, improve grid reliability, and increase energy efficiency. Funding for this program is provided by the Community Benefits Fund (CBF), enacted by the New Mexico Legislature in 2025. Seventy million dollars were allocated to this non-reverting fund to support grid modernization initiatives. The CBF requires that funded projects either conduct at least two community meetings within affected overburdened communities or enter into a negotiated community benefits agreement. Eligible applicants include a broad range of public and tribal entities: municipalities, county governments, state agencies, state universities, public schools, post-secondary educational institutions, and Indian nations, tribes, and pueblos. All projects must occur within the state of New Mexico. Funding can be used for various expenses including project development, design, regulatory assessments, equipment, and construction. However, costs such as land easements, legal fees, and water rights are not eligible. There are three types of projects supported: Type 1 (original research), Type 2 (pre-construction/design), and Type 3 (construction/installation/operation). The majority of funding—90%—will be directed toward Type 3 projects, with 5% each allocated to Types 1 and 2. Applicants may propose projects across multiple types in a single application. Each application must include a transmittal letter, detailed project narrative aligned with program goals, utility support letter, community benefits plan, budget, timeline, and proof of technical capabilities. Applications are accepted on a rolling monthly basis starting November 1, 2025, until all funds are expended. Projects must be completed within two years of contract execution, and no later than June 30, 2028. Projects will be evaluated based on capability, alignment with state energy goals, replicability, community engagement, educational value, and funding match. Special priority may be given to underrepresented applicant categories. Interested applicants can submit applications and direct inquiries to Chadette Pfaff at Chadette.Pfaff@emnrd.nm.gov. A pre-proposal conference is scheduled for October 7, 2025. The official Notice of Funding Opportunity (NOFO) and application instructions are available on the EMNRD website.

Projects are scored on alignment with grid goals, replicability, and economic development potential. ECAM offers pre-submission feedback.