On March 8, 2023, the U.S. Department of Energy Office of Clean Energy Demonstrations (OCED) issued a Funding Opportunity Announcement (FOA) with the hopes to catalyze high-impact, large-scale, transformational advanced industrial facilities to significantly reduce greenhouse gas (GHG) emissions in energy-intensive industrial subsectors.
OCED has been tasked with $25 Billion, from the Bipartisan Infrastructure Law (BIL) and Inflation Reduction Act (IRA), to support clean energy technology demonstration projects in areas such as clean hydrogen, carbon capture, grid-scale energy storage, small modular reactors and more. The announcement on March 8 allocates $6.3 Billion of this $25 Billion for industrial demonstrations of transformational technologies necessary to decarbonize energy-intensive industries.
Table 1: FOA Topic Areas and descriptions. All values anticipated.
|Topic Area||Description||Funding Provision||Technology Readiness Level*||Anticipated # of Awards||Anticipated Award Duration||Anticipated Federal Funding per Award**|
|1. Near-Net-Zero Facility Build Projects||World-leading, first- or early-of-a-kind, full facility builds resulting in significant emissions reductions up to net-zero operations.||BIL Section 41008||7-9||2-5||8-12 years||$100M-250M|
|2. Facility-level Large Installations and Overhaul Retrofit Demonstrations||Large-scale overhauls for existing facilities, common technologies across multiple facilities, or new builds with accelerated planning, development, permitting, and financing strategies||IRA Section 50161||7-9||10-30||3-7 years||$75M-500M|
|3. System Upgrades and Retrofits for Critical Unit Operations or Single Process Lines Within Existing Facilities||Upgrades, retrofits, and operational improvements that target decarbonization within a unit operation or process line at an existing facility||IRA Section 50161||7-9||10-30||3-7 years||$35M-75M|
*Subject to change depending on the number and quality of applications. **Federal share of funds for all awards is ≤ 50% total project costs. For proposals outside of the technology readiness level (TRL), award duration, or total funding ranges stated, applicants must explain and provide sufficient justification of how the project fits within the applicable Topic Area. Total funding per Topic Area may shift depending on the number of projects awarded by Topic Area.
This funding opportunity makes over $6 Billion in federal funds available to demonstrate and validate innovative decarbonization technologies so U.S. industrial sub-sectors can modernize and upgrade their infrastructure to not only decarbonize, but enhance U.S. competitiveness. OCED aims to fund projects in the highest emitting hardest to abate industries, including; iron, steel, steel mill products, aluminum, cement, concrete, glass, pulp, paper, industrial ceramics, chemicals, and other energy intensive industrial processes.
Applications will be selected based on largest emissions reduction potential, facility readiness and ability of applicant to act quickly, the clean product market viability; community benefits and others.
In the following sections Alturus will outline the FOA application process, which applications will receive priority, and how Alturus can assist your organization in securing this federal funding opportunity. Insights were generated by the team at Alturus using the U.S. DOE OCED Funding Opportunity Announcement Number: DE-FOA-0002936.
On March 8, 2023 the Department of Energy Office of Clean Energy Demonstration (OCED) announced a funding opportunity for the U.S. Industrial sector to demonstrate innovative and scalable decarbonization technologies. To accelerate these demonstrations and give US industrials a competitive advantage, OCED has allocated $6.3 billion in federal funding.
The newly created OCED was tasked with managing and allocating $25 Billion in funding to deliver clean energy demonstration projects at scale across the private sector. Currently, these funds have been allocated to seven different funding pools. The announcement on March 8, 2023 allocates $6.3 Billion of the $25 Billion specifically for Industrial Demonstrations of transformational technologies necessary to decarbonize energy-intensive, hard to abate industries. $500 Million of the allocated funds for this program come from the Bipartisan Infrastructure Law (BIL) with up to $5.812 Billion coming from the Inflation Reduction Act (IRA).
Eligble applicants, can submit projects for consideration which retrofit facilities at green or brownfield sites and demonstrate emission reducing technologies (funding through the BIL), or applicants can demonstrate single production line and unit process retrofits across with the ability to scale across multiple facilities (funding through the IRA).
The DOE will apply the following four-phase structure for projects selected under this FOA.
- Phase 1 will encompass initial planning and analysis activities to ensure that the overall concept is technologically and financially viable.
- Phase 2 will finalize engineering designs and business development, site access, labor agreements, National Environmental Policy Act (NEPA) review, permitting, and offtake agreements.
- Phase 3 will encompass installation, integration, and construction activities.
- Phase 4 will ramp-up to full operations including data collection to analyze the plant’s operations, performance, and financial viability.
This FOA solicits plans for all four phases of proposed activities; projects that have completed initial phases will be eligible to undergo accelerated early reviews for due diligence.
The application process includes multiple phases: Concept Paper, Application and possible, in person interviews or site visits. Written materials to be submitted during the application process must meet formatting, length and size requirements outlined by OCED and be submitted by 5:00 PM EST on the submission date. Contact the team at Alturus to learn how we can assist your organization in the application process.
Applicant must clearly show how the proposed project will:
- Reduce GHG emissions at the eligible facility and contribute to the acceleration of industry toward net-zero GHG emissions by 2050;
- Demonstrate favorable technical and economic feasibilities and its potential for timely replicability in other facilities;
- Offer potential for financial and market viability for the clean products, with priority for partnerships with clean product purchasers;
- Provide the greatest good for the greatest number of people in its surrounding communities, including through the reduction of other pollutants and waste streams;
- Support the creation and retention of good-paying, stable industrial sector jobs that will support broadly shared prosperity in the communities in which the facilities are located
- Contribute to energy and national security by, for example, reducing dependence on foreign products or positioning U.S. industry for long-term competitiveness.
Concept Paper: Due April 21, 2023
Application, contingent on submission of concept paper; Due August 4, 2023 Concept Paper:
To be eligible for funding, applicants must submit a Concept Paper by April 21, 2023. Each Concept Paper must be limited to a single concept for a project; however, projects can be an aggregation of technologies demonstrated at multiple eligible facilities, or multiple technologies demonstrated at a single eligible facility (e.g., large retrofit facility overhaul). If an organization has multiple stand-alone projects which cannot be aggregated into one program, then multiple Concept Papers must be submitted.
The Concept Paper must include;
- Cover Page (1 Page Max)
- Includes project title, specific Topic Area addressed, industry the industry sector(s) in which the project will be demonstrated, Area(s) of Interest, both the technical and business points of contact, names of all team member organizations, the project location(s), and any statements regarding confidentiality
- Project Plan (6 Pages Max)
- The proposed project, including technology, construction activities, infrastructure development
- A preliminary development plan and timeline, including risks and challenges and impact on industrial decarbonization
- How DOE funding impacts the project
- How the proposed project meets the objectives of the FOA
- The proposed project’s target level of performance for carbon intensity reduction
- The proposed project’s replicability and how the project will catalyze industry-wide change through deployment at additional facilities and/or by accelerating domestic or global standard setting
- Community Benefits (2 Pages Max)
- Supporting meaningful community and labor engagement
- Investing in the American workforce by supporting quality jobs
- Advancing DEIA
- Contributing to the Justice40 Initiative
- Providing the greatest benefit for the greatest number of people within the area of the project
- Management and Organization (1 Page Max)
- Clear demonstration of the Lead Project Manager and applicant’s skills, experience and expertise in designing, developing and operating the proposed project
- Past experience with similar projects to the proposed project
- Demonstration of adequate resources necessary to complete the proposed project
- Summary organization chart of the team developing the project
After submission of the Concept Paper applicants will have until August 4, 2023 to submit their full application. Only applicants who submitted a Concept Paper will be eligible for funding. Applications must demonstrate how the proposed project reduce carbon intensity in one of three Topic Areas (Table 2). The Topic Area chosen determines the length of application materials required.
Table 2: Target metrics for facility-or process-level contributions to product carbon intensity reduction by Topic Area
Project Topic Area
Reduce Carbon Intensity
% Carbon intensity reduction in MT CO2e/kg product
Completed applications include the following: (More information on requirements for each component of the application can be found in Section 4.6.2-184.108.40.206 of the FOA)
- Application for Federal Assistance (SF-424); Government-wide standard form for grant application packages and requires basic information on the applicant and project description
- Technical Volume; Includes; a) Project Summary; b) Business Development and Management; c) Engineering, Procurement, Construction, and Operations; d) Safety, Security, and Regulatory Requirements; e) Risk Analysis and Mitigation; f) TEA and LCA Projections; and g) Workplan.
- Project Summary; a) Project title; b) Project Topic Area; c) technical and business points of contact; d) Project location; e) Any statements regarding confidentiality
- Business Development and Management; a) Project Plan; b) Business Plan; c) Management Plan; d) Financial Plan
- Engineering, Procurement, Construction and Operations; a) Technology; b) Performance projects; c) Engineering, design, and procurement; d) cost estimates; e) execution schedules; f) operating and disposition plans
- Safety, Security, and Regulatory Requirements; a) Safety; b) Cybersecurity; c) Permitting; d) NEPA requirements
- Risk Analysis and Mitigation; a) Risk Management Plan; b) Risk Register
- Techno-Economic Analysis and Life Cycle Analysis Projections; a) Preliminary Techno-Economic Analysis, including capital costs, tax credits, operating costs, revenue streams, operational period; b) Preliminary Life Cycle Analysis
- Workplan; a) Project Objectives; b) Technical Scope Summary; c) WBS and Task Description Summary; d) Go/No-Go Decision Pints; e) End of Project Goal; f) Integrated Project Schedule
- Community Benefits Plan: Job Quality and Equity; a) Community and Labor Engagement; b) Investing in American Workforce; c) Diversity, Equity, Inclusion, and Accessibility; d) Greatest Benefit for the Greatest Number; e) Justice40 Initiative
- Community Partnership Documentation; a) Documentation to demonstrate existing or planned partnerships with Tribes and community entities
- Resumes; a) Resumes must be provided for all senior and key personnel
- Letter of Commitment; a) Submit letters of commitment from all subrecipient and third-party cost share providers
- Budget and Budget Justification; a) Budget Justification Workbook; b) Subrecipient budget justification (if applicable); c) Contract budget justification (if applicable); d) Budget for DOE/NNSA FFRDC (if applicable)
- Summary for Public Release; a) One page summary suitable for dissemination to the public
- Summary Slide; a) Single slide summarizing the proposed project
- Environmental Considerations Summary; a) Inclusion of as much detail as possible so the DOE can determine what level of NEPA review is necessary. Consultation with experts or advisors in your organization to assist with your responses is highly recommended
- Current and Pending Support Disclosures; a) All resources made available, or expected to be made available, to an individual in support of the individuals’ research, development, demonstration and deployment efforts; b) Disclosure of senior/key personnel who will contribute to the proposed projects deployment
- Disclosure of Lobbying Activities; a) Complete and submit SF-LLL, “Disclosure of Lobbying Activities”
- Potentially Duplicate Funding Notice; a) Applicant must notify the DOE if there is potentially overlapping funding for the proposed project from a previously awarded grant
- Transparency of Foreign Connections; a) See full required list of foreign connection disclosures in section 220.127.116.11 of the FOA
The DOE OCED will review all Concept Papers and Applications based on weight criterion, with additional consideration given to select categories and elements of the proposed project.
Concept Paper Criterion: Overall FOA Responsiveness and Viability of the Project (Weight: 100%)
All sub criteria are of equal weight:
- Applicant clearly describes the proposed scope of the demonstration project including the key technologies and systems, total cost of the project, and non-federal cost share amount, GHG emissions reductions, proposed timeline, and other applicant proposed metrics
- Applicant clearly identifies how the proposed project ultimately facilitates a transition to significant industrial decarbonization in the U.S.; including the replicability and uptake potential
- Degree to which the proposed project aligns with and demonstrates potential to accelerate progress within demand-side objectives set forth by the Buy Clean Initiative and/or the First Movers Coalition
- If applicable; applicant demonstrates how it plans to leverage DOE Funding and other federal and/or state programs
- Applicant has identified a preliminary project development plan and timeline including a finance plan, any key risks, challenges, and possible mitigation strategies
- Applicant and the proposed team have the qualifications, experience, capabilities and other resources necessary to design, develop, build and operate the proposed project
- Description of strategies to ensure meaningful community and labor engagement and the proposed project supports the climate justice initiatives outlined in the FOA
- Proposed work, if successfully accomplished, would meet the objectives as stated in the FOA, including achieving market liftoff and attracting follow-on investments from the private sector.
Application Technical Review Criterion:
All sub criteria are of equal weight:
- Criterion 1: Technical Merit, Innovation, and Impact (25%)
- Degree to which the proposed technologies achieve GHG emissions reduction from carrying out the project and achieve the technical objectives outlined in the FOA
- Degree to which the proposed project can justify an ability to quickly achieve its technical objectives, be replicated to other facilities and encourage broader industry wide accelerated decarbonization
- Adequacy of emissions reductions metrics, preliminary techno-economic analysis, and the value proposition and timeline
- Degree to which the proposed technologies and their commercial viability are clearly described in the application
- Adequacy and clarity of the risk assessment and risk management discussion
- Degree to which the proposed project can benefit wors and the surrounding communities by reducing safety burdens and/or mitigating risks
- Criterion 2: Financial and Markey Viability (20%)
- Degree to which the applicant assesses and demonstrates potential market competitiveness and sustainability for the proposed project through market analysis and offtake agreements
- Availability, credibility, and risk/terms of non-federal cost share sources and funds necessary to meet ongoing cost share needs. This includes the ability to leverage DOE financial assistance funding from this FOA with state and local incentives and private financing
- Degree which the applicant discloses each key participating organization’s financial commitment to the proposed project including overall financial strength and financial capability to implement the proposed plan and its growth beyond DOE funding
- Degree to which the proposed project aligns with and demonstrates potential to accelerate progress within demand-side objectives set forth in the Buy Clean Initiative, Federal Sustainability Plan, and/or the First Movers Coalition
- Degree to which the proposed project utilizes and leverages additional regional resources
- Adequacy and justification of the proposed budget and spend plan covering both DOE funding and non-federal cost share.
- Adequacy of the business plan for developing key project agreements such as financing, acquisition strategies, power purchase agreements, supply chain, offtake (sales) agreements, and other relevant project documents.
- Adequacy and clarity of the financial risk management discussion and a demonstrated understanding of financial and market risks involved in the proposed work, as well as the quality of the mitigation strategies to address them.
- Criterion 3: Workplan (15%)
- Overall reasonableness of the project schedule based on the complexity of the proposal
- Degree to which the proposed workplan, task descriptions, and critical path have been clearly laid out with reasonable expectations and resulting in a high likelihood that the proposed Workplan will succeed in meeting the project goals
- Strength and level of clarity in the definition of the project phases, metrics, Integrated Project Schedule, and Go/No-Go criteria and deliverables as defined in the application so that DOE independent experts are able to accurately review submissions
- Potential for disruption to current facility operations and the degree to which the management plan for that distribution is presented
- Extent to which the Community Benefit Plan is integrated into the project
- Criterion 4: Management Team and Project Partners (20%)
- Capability, qualification, experience, appropriateness and reasonableness of the prime recipient, the proposed team, and key personnel to manage and address all aspects of the proposed work
- Level of participation by project participants as evidence by letters of commitment and how well they are integrated into the workplan
- Degree which existing facilities/infrastructure are leveraged to support the project
- Strength of the project management discussion in the project Workplan to give high confidence of project success
- Adequacy and clarity of the risk management discussion as it pertains to the project team and project management aspects of the proposed project.
- Demonstrated understanding of key team and project management risks involved in the proposed work, as well as the quality of the mitigation strategies to address them.
- Criterion 5: Community Benefits Plan (20%)
A detailed list of each of the sub criterion components can be found in section 5.22 of the FOA
- Overall approach
- Community and Labor Engagement
- Investing in the American Workforce
- Diversity, Equity, Inclusion, and Accessibility
- Greatest Benefit for the Greatest Number (IRA Priority Consideration)
- Justice40 Initiative
Since the announcement, the team at Alturus has conducted a detailed review of the FOA, the requirements of the application, and what applicant criteria the DOE will give significant consideration towards. Through this analysis, and discussion with independent experts, innovative projects with significant emissions reductions, community benefits and high scalability will be prioritized during the application review process.
Alturus has had success securing federal funding for large scale industrial decarbonization projects, recently receiving a multi-mullion dollar commitment for a current initiative. The DOE’s emphasis on innovative, scalable projects presents an exciting opportunity for Alturus and our customers to find similar success through this funding mechanism.
Programs implemented by Alturus are designed for scale, accelerate industrial decarbonization, and utilize innovative technologies. These factors make Alturus programs strong candidates to receive funding through OCED’s FOA.
Alturus is working with our customers to submit Concept Papers on projects currently being developed and implemented by our team. Utilizing customer data and detailed engineering we are submitting compelling, and accurate applications for DOE funding consideration.