By any measure, the nation’s disaster landscape has changed. In 2024 alone, the federal government issued 90 major disaster declarations—nearly double the long-term average. Much of this surge is driven by climate-related extremes: hotter heat waves, colder cold snaps, stronger storms, and more frequent wildfires and floods. For electric utilities, these events don’t just test emergency response plans, they test the resilience of the grid itself.
When disaster strikes, the Federal Emergency Management Agency is a critical partner. The agency typically covers 75% of eligible disaster restoration costs, helping communities rebuild and prepare for future disasters. But electric utilities—especially not-for-profit, consumer-owned systems that cannot rely on tax deductions—know firsthand how delays and red tape can stretch recovery timelines and threaten higher rates. For these reasons, utilities have urged Congress to make much-needed reforms to improve FEMA’s response capabilities and timelines. And with 433 of the nation’s 435 congressional districts having experienced at least one FEMA event over the past 15 years, lawmakers recognize the importance of making improvements for their constituents back home.
FEMA’s role in disaster recovery
Following a presidential disaster declaration, FEMA may activate three major programs:
- Public assistance, for emergency work and permanent repairs to public infrastructure, including power lines, substations, and transmission and distribution systems.
- Individual assistance, to help households recover.
- Hazard mitigation assistance, to reduce long-term risk.
For consumer-owned utilities, the public assistance program is essential. It reimburses costs for debris removal, temporary generation, overtime, and permanent repairs. Utilities can also access the Hazard Mitigation Grant Program, which funds mitigation and preparedness projects that strengthen facilities against future events.
Although intended to provide quick response to help communities recover and rebuild, utilities report long delays in receiving funds, complex and inconsistent documentation requirements, and conflicting guidance from FEMA and other federal partners. Environmental and historic preservation reviews can stretch for months, and appeals can take years. The result? Utilities must front enormous costs to restore power systems quickly, which often requires taking out loans. When FEMA reimbursements lag, interest accrues, and customers ultimately pay those costs. Adding to the frustration is FEMA’s general prohibition on using public assistance funds to upgrade systems during restoration. Rebuilding to yesterday’s standards may restore service, but it can lock in vulnerabilities and increase future federal and local costs when the next storm hits.
A bipartisan push to fix the system
Recognizing these challenges, House Transportation and Infrastructure Committee Chairman Sam Graves (R-Mo.) and Ranking Member Rick Larsen (D-Wash.) introduced H.R. 4669, the Fixing Emergency Management for Americans Act of 2025, or FEMA Act. The bill aims to modernize the nation’s emergency management framework through several reforms focused on elevating decision-making authority, streamlining grant program processes, reducing time delays, and improving transparency and accountability.
The FEMA Act would restore FEMA’s status as an independent, cabinet-level agency, allowing FEMA’s administrator to report directly to the U.S. president—this had been the case up until the creation of the Department of Homeland Security in 2003, which absorbed FEMA. Supporters argue this would cut through layers of bureaucracy, elevate decision-making authority during crises, and improve coordination across federal agencies.
The bill’s public assistance program reforms are among the most consequential. The bill sets clear deadlines: FEMA would have 120 days to obligate funds after an applicant submits a reimbursement request. It also streamlines environmental and historic preservation reviews to minimize unnecessary delays. Predictable timelines would allow utilities to plan financing more efficiently and reduce the carrying costs that ultimately hit customers.
The FEMA Act also allows for more proactive mitigation planning prior to disasters, supporting projects such as elevating flood-prone homes, acquiring and demolishing properties in high-risk areas, and retrofitting buildings to withstand earthquakes and hurricanes. For utilities, a stronger mitigation framework aligns with the goal of building a more resilient grid and reducing future restoration costs.
Lastly, the FEMA Act mandates public dashboards and searchable databases to track disaster declarations, funding obligations, and appeals outcomes. It also creates a working capital fund to support ongoing operational needs and services, and it directs the Government Accountability Office to review FEMA regulations and assess risks related to identity theft and disaster fraud.
Getting from the committee room to the president’s desk
The FEMA Act advanced out of committee on a strong bipartisan vote of 57-3 in September 2025 and now awaits consideration on the House floor. While similar legislation has not yet been introduced in the Senate, the bipartisan committee vote suggests broad recognition that FEMA’s structure and processes need updating to match today’s disaster realities.
The reform push comes amid reports that President Donald Trump’s administration has considered reorganizing FEMA. In response, House and Senate appropriators used report language accompanying the Homeland Security appropriations bill to caution against any reorganization without congressional approval, underscoring lawmakers’ desire to protect FEMA’s core mission.
Utilities across the country have shared their frustrations with current FEMA practices and have engaged lawmakers in support of the FEMA Act. Member-consumer letters, association advocacy, and direct outreach have emphasized a simple message: A modernized FEMA will help communities recover faster, build a more resilient grid, and protect customers from unnecessary cost increases.
As Congress considers the bill, the electric utility community has a stake in the outcome. Disasters are no longer rare, regional events. They are frequent, nationwide stress tests for the electric grid. The FEMA Act offers a blueprint to make FEMA more responsive, transparent, and aligned with the realities utilities face on the ground.
