Electric Grid Modernization Grant Program

The Grid Modernization Grant Program administered by the Energy Conservation and Management Division (ECAM) within the New Mexico Energy, Minerals and Natural Resources Department (EMNRD) seeks to catalyze a clean energy transition through strategic investments in grid infrastructure. This grant opportunity, supported by the 2025 Community Benefits Fund (CBF) Act, provides funding to eligible government entities to implement projects that contribute to New Mexico’s broader energy goals of achieving 100-percent zero-carbon electricity. With a focus on enhancing reliability, efficiency, and resilience, the program prioritizes modernization of electric distribution and transmission systems to accommodate renewable energy, distributed resources, and evolving consumer demands. This initiative stems from New Mexico’s Grid Modernization Roadmap, developed in 2020 as a statutory response to the Energy Grid Modernization Roadmap Act. The Roadmap outlines the state’s transition strategy toward a zero-carbon electricity system and mandates ECAM to operate a grid modernization grant mechanism. In 2025, the New Mexico Legislature allocated $70 million from the CBF into the Grid Modernization Grant Fund to accelerate deployment of qualifying projects. Of this total, 90% is allocated to Type 3 construction/installation projects, while 5% each is reserved for Type 1 original research and Type 2 design/pre-construction projects. Projects may address multiple grid goals including reliability, security, load adaptation, distributed energy integration, and customer data capabilities. Eligible applicants include New Mexico-based municipalities, counties, state agencies, public schools, public universities and colleges, and Indian nations, tribes, and pueblos. All projects must be located within New Mexico and comply with applicable environmental, cultural, and regulatory requirements. Eligible costs may include project development, engineering, environmental assessments, construction, inspection, and initial monitoring. Costs that are not eligible include land acquisition, legal fees, and water rights. Applicants must ensure their project fits into one of the three defined project types and can be completed within the respective two-year (Types 1 and 2) or four-year (Type 3) timeframes post-contract execution. The application process requires submission of a transmittal letter, detailed project narrative, scope of work, utility support letter, community benefits plan, deliverables-based budget and timeline, and evidence of technical capabilities. Applications are accepted on a monthly rolling basis starting November 1, 2025, until funds are exhausted. All applicants must also address community engagement by either conducting two public meetings or submitting a negotiated community benefits agreement with overburdened communities impacted by the proposed project. Application narratives must demonstrate alignment with EMNRD’s goals related to grid reliability, innovation, economic development, education, and replicability. Evaluation is based on a rubric that includes the capability to deliver, alignment with grid goals, broader impact, community engagement, educational value, funding match, and underrepresentation of applicant type. Proposals are scored and queued for funding based on their total score. Selected grantees will enter into a Governmental Services Agreement with EMNRD and are required to submit progress and expenditure reports throughout the project lifecycle. Applications must be submitted via email to Chadette Pfaff at [email protected] by 3:00 p.m. Mountain Time on November 1, 2025. A pre-proposal conference will be held on October 7, 2025. Awards are contingent upon appropriation availability and contracts are not valid until formally executed by EMNRD and funds encumbered. All work must be completed within the contract-specified period, and award funds will cover gross receipts taxes.

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