The U.S. Department of Energy (DOE) has finalized a $1.6 billion loan guarantee aimed at improving grid reliability and lowering electricity costs in the Midwest. The loan, provided through the DOE’s Loan Programs Office (LPO), will support a subsidiary of American Electric Power (AEP) in reconductoring and rebuilding approximately 5,000 miles of transmission lines in Indiana, Michigan, Ohio, Oklahoma, and West Virginia.
This project is expected to create over 1,000 construction jobs and increase grid capacity in areas experiencing rapid growth. The initiative follows President Trump’s Executive Order focused on strengthening the reliability and security of the U.S. electric grid.
U.S. Secretary of Energy Chris Wright stated, “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. 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 evaluated the loan guarantee under new LPO guidance introduced by Secretary Wright. The financial close for AEP marks the first completed loan guarantee under the Energy Dominance Financing (EDF) Program, established by the Working Families Tax Cut, also known as the One Big Beautiful Bill Act, which President Trump signed into law earlier this year. Utilities receiving EDF loans are required to ensure that customers benefit financially from the financing.
DOE has stated its ongoing commitment to use available resources, including the LPO, to provide affordable, reliable, and secure energy to Americans.
