Small Business Retooling Grant Program

The Small Business Retooling grant program is administered by the Michigan Department of Environment, Great Lakes, and Energy through its Energy Unit within the Materials Management Division. The program is designed to support small manufacturing businesses across Michigan in implementing energy efficiency and renewable energy improvements. As part of the state’s broader climate and economic strategy, including alignment with the MI Healthy Climate Plan, the program emphasizes reducing energy consumption, lowering operational costs, and improving long-term business resilience in the industrial sector. The initiative is funded in part through federal support from the U.S. Department of Energy’s State Energy Program and operates under associated federal grant requirements. The primary purpose of the program is to enable small manufacturers to undertake projects that reduce energy use and improve process efficiency. Eligible activities include energy waste reduction, energy efficiency upgrades, and improvements to manufacturing processes that result in measurable cost savings. Applicants are encouraged to base their proposals on energy audits or assessments conducted by recognized providers such as university industrial assessment centers or technical assistance programs. Projects must demonstrate clear benefits in terms of energy savings, operational improvements, and potential for replication across Michigan’s manufacturing sector. Funding is provided on a reimbursement basis, meaning recipients must incur and document eligible expenses prior to receiving payment. The program anticipates distributing approximately $200000 in total funding, with individual awards typically ranging from $5000 to $50000. All applicants are required to provide a minimum one-to-one cost share match, which may include cash, in-kind contributions, or third-party support. Funds must be used within the established grant period, which is expected to run through September 30, 2027, and any expenditures outside the approved timeline are not eligible for reimbursement. Eligibility is limited to small manufacturing businesses located in Michigan with 500 or fewer employees worldwide. Applicants must be in good standing with the State and must demonstrate that their proposed project aligns with program objectives and priorities. Projects must take place within Michigan and involve commercially available technologies. Certain projects are explicitly ineligible, including those involving non-commercial technologies, projects outside the state, or those requiring environmental review without prior approval. Facilities involved must be operational and expected to remain in use long term. The application process requires submission of a complete proposal through an online system, including an application form, an approved budget with narrative, and supporting documentation such as organizational charts, financial statements, and project timelines. Additional documentation may be required depending on the nature of the project, including environmental compliance forms or partnership agreements. Applicants are encouraged to consult with the program contact prior to submission and may also access free technical assistance through affiliated programs. Proposals are evaluated through a structured scoring process that considers project scope, feasibility, impact, organizational experience, and alignment with program priorities. Each of these criteria contributes equally to the total score. The program also emphasizes the importance of documenting and sharing project outcomes, including energy savings and cost reductions, and requires ongoing reporting, including monthly updates, final documentation, and follow-up assessments after project completion. The application period operates on a rolling basis and will remain open until all available funds are allocated. Questions regarding the program must be submitted by a specified deadline prior to the initial review period, and responses are published publicly. Selected applicants must enter into a formal grant agreement within a defined timeframe and comply with all reporting, documentation, and federal compliance requirements. Program oversight is managed by a designated contact within the Energy Unit, who also serves as the primary point of communication for applicants throughout the process.

Align project with program priorities including energy savings and measurable impact. Provide detailed documentation and clear budget justification. Demonstrate feasibility and strong organizational experience.