UI Seeks $37.5 Million Grant to Accelerate Smart Grid Infrastructure

The United Illuminating Company (NYSE:UIL) Tuesday, filed an application with the U.S. Department of Energy (DOE) for a $37.5 million grant in "Smart Grid” funds that would enable the company to accelerate efforts to modernize its transmission and distribution system.

UI would invest an equal amount of its own funds in the proposed $75 million project to be completed over three years. If granted, UI would invest the funds in a range of projects designed to upgrade the power grid’s capabilities in numerous ways, and in so doing offer measureable benefits to UI’s customers.

"These funds would help accelerate the programs we have in place or have planned to implement,” said UI CEO James P. Torgerson. "As a result, we will be able to bring the benefits of new technology to our customers much faster.”

In the simplest of terms, the smart grid will connect critical points along the system that delivers electricity – from the power plant to the electrical outlet in homes or businesses – by establishing two-way flows of communications.

Once it is fully deployed, the smart grid is envisioned to:

• Improve consumers’ ability to monitor and manage their energy usage and save money on monthly electric bills;
• Allow for a more efficient integration of emerging technologies such as renewable energy; and
• Further enhance system reliability by allowing utilities to detect, isolate and respond to power outages more quickly, keeping the lights on for more people and avoiding costly blackouts.

Funding for the DOE’s Smart Grid Investment Grant Program (SGIG) has been appropriated under the American Recovery and Reinvestment Act of 2009 (the stimulus package), and will be administered by the DOE’s newly created Electricity Delivery and Energy Reliability program.

Grants dispersed through the program are intended to cover up to 50 percent of the cost of individual applicants’ smart grid expenditures. Remaining costs associated with UI’s smart grid deployment program would be reviewed by the Connecticut Department of Public Utility Control (DPUC) before the costs are included in customers’ rates.

"The smart grid funds UI has requested from the DOE would build upon ongoing efforts the Company has undertaken over the course of several years,” said Joseph T. Ballantine, associate vice president - Business Strategy & Development, who is heading the development of UI’s grant application.

The infusion of SGIG funds would allow UI to significantly ramp up a number of programs designed to:

Further enhance system reliability. Investments in this area would include an increase in the number of sensors along the grid, which would allow UI to pinpoint power outages and remotely turn off power in a problem area. The Company has plans in place to establish an updated communications system that notifies customers when and where outages occur and when they could expect power to be restored.

Improve asset utilization and efficiency. Investments in this area would allow UI to better accommodate the integration of renewable sources of power to its grid, as well as escalate ‘demand-side’ management programs that allow utilities to call on customers who choose to voluntarily cut back on their usage when supplies are tight and demand is high.

Establish two-way communications. One of the central elements of the smart grid is the establishment of integrated, two-way communications systems between utilities and their customers. Research consistently shows that if consumers are more aware of the variable price of electricity – and were rewarded financially for cutting back usage during periods of peak demand – they would have the tools and information they need to manage their energy usage and lower their monthly electric bills.

Install advanced meters & metering infrastructure. The investment of SGIG funds would enable UI to speed up the installation of advanced meters that maintain a continuous, two-way connection between the utility and its customers. Over time, UI also plans to add home display units that will allow customers to easily monitor their energy consumption without logging on to the Internet and program "smart appliances” that cycle on or off depending on time of day or the price of electricity.

Create Jobs. Using the DOE formula for job creation it is estimated this proposal will create or retain 368 jobs in the three-year development phase and 15 permanent jobs.

The United Illuminating Company (UI) is a New Haven-based regional distribution utility established in 1899. UI is engaged in the purchase, transmission, distribution and sale of electricity and related services to more than 324,000 residential, commercial and industrial customers in the Greater New Haven and Bridgeport areas. UI’s World Wide Web address is http://www.uinet.com/. UI’s parent company, UIL Holdings Corporation, is traded on the New York Stock Exchange under the symbol UIL.

Certain statements contained herein, regarding matters that are not historical facts, are forward-looking statements (as defined in the Private Securities Litigation Reform Act of 1995). These include statements regarding management’s intentions, plans, beliefs, expectations or forecasts for the future. Such forward-looking statements are based on UIL Holdings’ expectations and involve risks and uncertainties; consequently, actual results may differ materially from those expressed or implied in the statements. Such risks and uncertainties include, but are not limited to, general economic conditions, legislative and regulatory changes, changes in demand for electricity and other products and services, unanticipated weather conditions, changes in accounting principles, policies or guidelines, and other economic, competitive, governmental, and technological factors affecting the operations, markets, products and services of UIL Holdings’ subsidiary, The United Illuminating Company. The foregoing and other factors are discussed and should be reviewed in UIL Holdings’ most recent Annual Report on Form 10-K and other subsequent periodic filings with the Securities and Exchange Commission. Forward-looking statements included herein speak only as of the date hereof and UIL Holdings undertakes no obligation to revise or update such statements to reflect events or circumstances after the date hereof or to reflect the occurrence of unanticipated events or circumstances.