If your utility is pursuing federal funding for grid modernization, infrastructure upgrades, or energy storage projects, the Build America, Buy America (BABA) Act is not something you can afford to overlook. Enacted as part of the Infrastructure Investment and Jobs Act in 2021, BABA established domestic content requirements for virtually all federally funded infrastructure projects. For electric cooperatives and municipal utilities, understanding what it requires and where the compliance gaps tend to show up can save significant time, money, and project delays.
Here is what you need to know.
What BABA Requires
At its core, BABA requires that materials and products used in federally funded infrastructure projects meet domestic sourcing standards. For electric utilities, that means any project using federal grants for grid work, transmission and distribution upgrades, or energy storage must comply.
The requirements fall into a few categories. Iron and steel must be manufactured entirely in the United States. Construction materials must also be made domestically. For manufactured products, which is the category most relevant to utility procurement, the rule requires that final assembly occur in the United States and that domestic components account for more than 65% of the total cost of all components, with that threshold rising to 75% by 2029.
That last requirement is where most of the complexity lives.
Where Compliance Gets Complicated
For cooperatives that are RUS borrowers, BABA compliance adds a layer of complexity that goes beyond simply finding a domestic supplier. RUS maintains its own list of approved materials, and if a domestic supplier meets BABA requirements but is not RUS-approved, you can find yourself caught between two sets of rules with no clean path forward.
There are also product categories where domestic sourcing is genuinely difficult. Some components simply are not manufactured domestically at scale, and clear guidance on how to handle those situations is still developing. Waiver processes exist for cases where domestic content requirements are impractical or cost-prohibitive, but navigating those requires time and documentation.
The good news is that many of the highest-value items utilities buy regularly are BABA-compliant. Transformers, poles, wire, and crossarms are largely available through domestic suppliers that meet the requirements. The challenges tend to concentrate in products with many individual components, like cutouts, arresters, and switches, and in smaller mass-produced items like connectors, where domestic availability is more limited and harder to verify.
How UUS Helps
At United Utility Supply, we work directly with cooperatives and other utility customers to identify BABA-qualified material before procurement decisions are made, not after. We have an extensive supplier network, and we are actively building the communication pathways needed to quickly identify available BABA-certified products when customers need them.
If you are working through a federally funded project and trying to determine whether your material list is compliant, start that conversation early. The earlier we can review what you need, the more options we can put in front of you. Waiting until a project is already in motion makes everything harder, and in some cases more expensive.
The Bottom Line
BABA is not going away, and the domestic content thresholds are only going to increase over time. For utilities pursuing federal funding, building BABA compliance into your procurement planning from the start is the most practical approach. Know which products qualify, understand where the gaps are, and work with a supplier who has done the homework on your behalf.
That is exactly what we are here for.
Have questions about BABA compliance or sourcing qualified materials for a federally funded project? Connect with your UUS account manager or reach out via our contact form directly.