New Act Funds Microgrids and Job Training for US Territories, Banning Fossil Fuel Projects

This new legislation, the Renewable Energy for US Territories Act, is essentially a major funding injection aimed at modernizing the power grids in U.S. territories like Puerto Rico, Guam, and the U.S. Virgin Islands. It establishes a brand-new grant program, run surprisingly by the Secretary of Agriculture, to fund clean energy projects. The core idea is to boost energy resilience and sustainability where it’s needed most.

The Smart Money: What the Grants Cover

If you’re a non-profit organization in a territory (a “covered entity,” as determined by the Secretary of Agriculture), this bill offers serious cash for four key areas. First, you can use the funds to build or develop renewable energy systems—think solar farms or wind projects. Second, the money covers energy efficiency upgrades, which translates directly into lower power bills for residents and businesses. Third, and critically important for reliability, the grants can fund energy storage systems, microgrids, or smart grids (SEC. 2). A microgrid is basically a local power system that can completely disconnect from the main grid and run itself during an outage, which is huge for storm-prone areas. A smart grid uses digital tech to manage power flow efficiently, cutting down on waste and cost.

Local Jobs and Technical Backup

One provision that stands out is the focus on local workforce development. Grant money can be used to train local residents in the territory on how to build, maintain, and operate these new renewable energy systems (SEC. 2). This means the infrastructure investment isn’t just about hardware; it’s about creating skilled, sustainable jobs right where the projects are built. To ensure these projects succeed, the bill mandates that the Department of Energy’s national laboratories provide technical assistance to every grant recipient (SEC. 2).

The Explicit Exclusions

The bill is crystal clear on what the money cannot be used for: funds are strictly prohibited from supporting any facility that generates electricity using fossil fuels or nuclear power (SEC. 2). This is a hard line in the sand, ensuring that the federal investment is solely focused on clean energy transition. This prohibition directly affects any group or company currently relying on or planning to build out traditional power generation in the territories.

A Vague Application Process and Accountability

While the goals are excellent, there are a couple of points to watch. The application process gives the Secretary of Agriculture wide latitude, requiring applicants to submit “whatever information the Secretary decides is necessary” (SEC. 2). This broad administrative power could create hurdles or slow down the process if not managed efficiently. Furthermore, the funding for the grant program is authorized as “whatever money is necessary,” which is an open-ended commitment that Congress will have to manage through appropriations.

To ensure accountability, the Secretary must report to Congress annually, detailing how much money was spent, the energy conservation achieved, and any difficulties encountered (SEC. 2). Separately, the Government Accountability Office (GAO) is required to conduct a study within 180 days, using $1.5 million in authorized funding, to specifically analyze the potential for microgrids and renewable energy to improve resilience across all U.S. territories (SEC. 3). This separate study shows Congress wants hard data on how best to proceed with modernizing these critical island power systems.