The U.S. Department of Energy (DOE) has finalized a $1.6 billion loan guarantee to support upgrades to the electric grid in the Midwest. The loan, managed by the DOE’s Loan Programs Office (LPO), will go to a subsidiary of American Electric Power (AEP) and will fund the reconductoring and rebuilding of approximately 5,000 miles of transmission lines across Indiana, Michigan, Ohio, Oklahoma, and West Virginia. The project is expected to create more than 1,000 construction jobs and improve the reliability and capacity of the grid in areas experiencing rapid growth.
This initiative follows President Trump’s Executive Order focused on strengthening the reliability and security of the U.S. electric grid. The financial close marks the first loan guarantee under the Energy Dominance Financing (EDF) Program, which was established by the Working Families Tax Cut—also known as the One Big Beautiful Bill Act—signed into law earlier this year. Utilities that receive an EDF loan are required to ensure that financial benefits from the financing are passed on to their customers.
“Thanks to President Trump and the Working Families Tax Cut, the Energy Department is ensuring the American people will have access to affordable, reliable and secure energy for decades to come,” said U.S. Secretary Wright. “The President has been clear: America must reverse course from the energy subtraction agenda of past administrations and strengthen our electrical grid. This loan guarantee will not only help modernize the grid and expand transmission capacity but will help position the United States to win the AI race and grow our manufacturing base.”
The DOE states that the loan guarantee was evaluated under new LPO guidance directed by Secretary Wright. The agency remains committed to using its available resources, including the LPO, to deliver affordable, reliable, and secure energy for Americans.
