On Oct. 27, 2009, President Barack Obama announced the largest single energy modernization investment in U.S. history to help the nation transition to a smarter grid.

The Department of Energy (DOE) grant awards, totaling $3.4 billion, will be augmented by the energy industry funding to bring the total value of the investment to more than $8 billion. The grant money is coming out of the $36.7 billion allocated to the DOE under the $787 billion American Reinvestment and Recovery Act of 2009, commonly called the stimulus package.

In addition to building a stronger, more efficient and reliable electric system, the investment also promotes energy-efficient choices for consumers and supports the growth of renewable energy, such as wind and solar. One hundred private companies, utilities, manufacturers, cities and other partners received 100 smart grid grants. They went to 49 states (Alaska excluded), ranging in size from $200 million to $787,250 for a town on Martha’s Vineyard. The largest grants of $200 million each went to CenterPoint Energy for smart meter program in the Houston area and to Baltimore Gas & Electric to deploy 1.1 million smart meters and a control system.

Besides improving the grid, the Obama administration hopes that these investments will create tens of thousands of jobs across the country. These include jobs for smart meter manufacturing workers, electricians, engineers, technicians, equipment installers, information technology and cyber security specialists, data entry clerks and database administrators, business and power system analysts, and others.

It may be instructive to see how one of the larger grants will be used. On the day Obama made his announcement, CenterPoint Energy Inc. also announced that its electric transmission and distribution subsidiary, CenterPoint Energy Houston Electric LLC, was notified by the DOE that it had been granted a $200 million for its advanced metering system and intelligent grid projects. The award is contingent on further negotiations with the DOE to actually receive the funds.

At the announcement, Tom Standish, group president of regulated operations for CenterPoint Energy said, “These funds will reduce the amount that Houston-area electric consumers will have to pay for this significant upgrade to our electric grid.”

CenterPoint will use $150 million of the grant to accelerate its current smart meter and associated equipment installations that make up its advanced metering system (AMS). The remaining $50 million will be used to accelerate the installation of the first phase of CenterPoint Energy Houston Electric’s Intelligent Grid that uses the AMS and other technologies to build a self-healing grid and to improve operational efficiency and reliability.

CenterPoint Energy Houston Electric’s smart meter deployment began in March, and by the end of this year, the company expects to complete the installation of 145,000 fully functional smart meters along with the necessary communications infrastructure and computing systems. With the aid of the federal grant money, more than 2 million smart meters are scheduled to be installed system-wide by the project’s completion in 2012.