POWER Act Allows Utilities to Use Emergency Disaster Funds for Future-Proofing Power Grids

The POWER Act of 2025 proposes a shift in how federal disaster relief funds can be used by electric utilities. It amends the Stafford Act, specifically Section 403 which covers immediate emergency assistance, to allow utilities to spend these funds not only on restoring power right after a disaster but also on 'cost-effective hazard mitigation' – basically, making the grid tougher against future storms or events – at the same time.

Restoration Plus Resilience?

Think of it this way: currently, Section 403 funds are primarily for getting the lights back on ASAP after a disaster hits – fixing downed lines, replacing broken poles. This bill lets utilities use that same pot of emergency money to also undertake projects designed to prevent future damage, like burying power lines or upgrading equipment, while they're doing the immediate repairs. The idea is to build back stronger, potentially making the grid more reliable in the long run. The bill specifies these mitigation activities must be 'cost-effective', though it doesn't detail exactly what that means in this context.

Keeping the Mitigation Door Open

The Act also clarifies a funding rule. It ensures that if an electric company receives emergency assistance under Section 403 (which now includes the option for simultaneous mitigation work), they aren't automatically disqualified from seeking separate funds under Section 406. Section 406 is specifically designed for hazard mitigation projects on facilities damaged during a disaster. So, utilities could potentially tap into both funding streams for related work stemming from the same event, provided they meet the eligibility criteria for each.

What This Means When the Lights Go Out

For folks dealing with power outages after a disaster, this could eventually lead to a more resilient grid that withstands storms better. Combining repair and future-proofing might streamline recovery efforts. However, allowing emergency funds, typically reserved for immediate life-saving needs, to be used for longer-term mitigation raises questions. The key challenge lies in defining and overseeing 'cost-effective' mitigation during an emergency response. Without clear guidelines, there's a potential for emergency funds to be diverted from immediate power restoration to projects that, while beneficial long-term, aren't the most critical need in the immediate aftermath. This change applies to disaster funds allocated from the date the bill is enacted onwards.