Act now: Funding available for thermal energy projects
Up to $4.8 million in grants available for thermal energy pilot projects; notify UTC of intent by June 5
Commerce is offering $4.8 million in funding for pilot projects that develop Thermal Energy Network (TEN) pilot projects, as allowed by ESHB 2131. Commerce will evaluate proposals from utilities that aim to develop and operate TENs, demonstrating innovative systems offering clean, efficient alternatives to conventional natural gas heating.
TENs are systems that deliver heat and cooling to buildings through a network of underground pipes. The heat can come from various sources such as industrial processes, renewable energy or geothermal systems. This pilot program is designed to accelerate the adoption of low-emission, sustainable heating technologies by helping to cover the cost gap between traditional gas service and TEN implementations. It also advances workforce development and promotes equitable clean energy access in overburdened and disadvantaged communities.
"Thermal energy networks are an innovative way to bring clean, community-scale heating to more people while cutting greenhouse gas emissions and helping us reach Washington’s climate goals," said Jennifer Grove, Assistant Director of Commerce’s Energy Division. "This funding will help get projects off the ground that are fair, scalable, and led by local utilities."
Commerce will collaborate closely with the Utility and Transportation Commission (UTC) to ensure projects are both ready for implementation and scalable, aligning with state energy goals. "The UTC is accepting notices of intent to implement thermal energy network pilot projects through June 5,” said Deputy Director of Regulatory Services, Brett Shearer. "Following that, we’ll evaluate filings based on feasibility, anticipated costs, and alignment with statutory requirements, and then provide recommendations to Commerce to inform final funding decisions."
Once approved by UTC and governing boards, gas or electric utilities may own, operate, and manage these systems and include them in general rate cases.
To maintain priority eligibility, applicants must notify the UTC of their intent to implement a pilot project by June 5, 2025, and begin implementation by December 2026.
Commerce will accept proposals by invitation only, with submissions expected no earlier than August 18, 2025, after UTC review and recommendations. The submission deadline may be adjusted depending on UTC’s timeline.
Grant awards may be funded for a maximum of $4.8 million per project.
Additional information
Commerce will prioritize projects based on:
- Cost-effectiveness
- Project readiness and scalability
- Geographic diversity
- Alignment with state climate and energy goals
- Workforce transition and equity outcomes
Alternatively, proposals may be evaluated based on:
- Information submitted to and reviewed by the UTC
- Readiness, including permitting, community engagement, and technical planning
- Scalability and potential for broader deployment
- Alignment with TEN definitions and support for utility-scale implementation
Who can apply
- Gas companies
- Electric utilities
- Public utility districts (PUDs)
For more information, contact Esther Nielson, Commerce program manager for Energy Programs in Communities.
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