FY 2023 Phase II Release 1 | DE FOA 0002859

Opportunity Information: Apply for DE FOA 0002859

The FY 2023 Phase II Release 1 Funding Opportunity Announcement (DE-FOA-0002859) is a Department of Energy (DOE) Office of Science SBIR/STTR competition designed specifically for small businesses that already hold eligible DOE SBIR/STTR Phase I or Phase II awards. The overall goal is to help prior awardees move their innovations beyond feasibility and into deeper research and development (R&D), prototype refinement, and ultimately commercialization. DOE is using this FOA to offer several related funding paths: an Initial Phase II award (the standard follow-on to Phase I), two kinds of Second Phase II awards (Phase IIA and Phase IIB), and a Third Phase II award option for SBIR projects only (Phase IIC). The FOA also mentions diversity supplements as part of the available opportunities. Applicants are expected to align their proposed work with the official topic and subtopic descriptions published on the DOE SBIR/STTR Funding Opportunities website.

For companies moving from Phase I to Phase II, the Initial Phase II award is meant to fund the substantial R&D needed to meet DOE technical objectives laid out in the original Phase I topic and subtopic. In practical terms, DOE expects this phase to push the work toward something tangible and demonstrable, such as a prototype, a product candidate, or a validated process that can be shown to potential investors or customers. The program is structured so that, by the end of Phase II, the business should be positioned to pursue real commercial applications, whether in the private market or through government customers (including DOE). Importantly, this Phase II FOA is described as supplemental to the FY 2022 SBIR/STTR Phase I Release 1 FOA (DE-FOA-0002554), meaning many of the baseline rules and general instructions from the Phase I FOA still apply. However, if anything in the Phase I FOA conflicts with the Phase II FOA, the Phase II FOA controls.

Beyond the standard Initial Phase II pathway, DOE is also offering Second Phase II awards that provide additional funding to companies that already have Phase II awards and need to either finish key development work or broaden the effort toward market readiness. The Phase IIA option is intended for additional R&D tasks that remain aligned with the original Phase II scope of work, essentially giving a company more runway to complete the work associated with early prototype, product, or process development. The review criteria for Phase IIA are stated to be the same as those used for Initial Phase II applications, which implies a strong focus on technical merit and successful execution within the established project direction. Eligibility for Phase IIA is limited: only recipients funded under the FY 2021 SBIR/STTR Phase II Release 1 FOA (DE-FOA-0002380) for certain eligible topics (as detailed in the FOA) may apply. A key rule is that the Phase II award must still be active at the time of application, and if a Phase IIA application is declined, the applicant cannot resubmit it later, so timing and readiness matter.

The Phase IIB Second Phase II option is positioned differently. It supports new R&D tasks that extend beyond the scope of the original Phase II award, with a clear emphasis on transitioning the innovation toward commercialization. Compared to Initial Phase II and Phase IIA, Phase IIB is reviewed using different criteria that place greater weight on impact and on the credibility of the commercialization plan. Applicants are expected to show a well-planned path to commercialization, supported by concrete commercialization activities that run alongside the Phase IIB R&D or follow it. Eligibility for Phase IIB is also restricted to certain prior award cohorts: only awardees from the FY 2020 and FY 2021 SBIR/STTR Phase II Release 1 FOAs (DE-FOA-0002156 and DE-FOA-0002380), under eligible topics listed in the FOA, may apply. The FOA also limits how companies can use this mechanism: for each eligible Phase II award, a company may submit only one Second Phase II application total, choosing either Phase IIA or Phase IIB. If awarded, a Second Phase II can extend the Phase II work for up to two additional years, and the combined duration of the Phase II plus the Second Phase II generally cannot exceed four years, unless there is an unforeseen delay.

For SBIR projects only, DOE also provides a Third Phase II option, called Phase IIC. This award is designed to continue R&D from a Second Phase II (Phase IIA or Phase IIB) and further drive the technology toward commercialization, but with an added requirement: it must be matched by funds from a third-party investor. Those matching funds can be applied either to R&D costs that are not included in the DOE budget request or to other commercialization-related costs tied to bringing the innovation to market. Eligibility is again tightly constrained: only companies with an active Phase IIA or Phase IIB award at the time of application may submit a Phase IIC application. As with Phase IIA, if the Phase IIC application is declined, there is no option to resubmit later, which makes it especially important to have investor commitments and commercialization logic clearly established before applying.

From an administrative and funding standpoint, this is a discretionary grant opportunity in the science and technology / R&D category (CFDA 81.049) run by the Department of Energy, Office of Science. The FOA was created on October 21, 2022, with an original closing date of December 6, 2022. DOE lists an award ceiling of $1,600,000 and anticipates making about 100 awards, indicating a competitive but relatively substantial program scale. Overall, the opportunity is structured to help DOE SBIR/STTR awardees progress step-by-step: from Phase I feasibility, to Phase II development and demonstration, to extended R&D and commercialization planning through Second Phase II options, and finally to investor-backed commercialization-oriented continuation funding through a Third Phase II (SBIR Phase IIC) for projects that are already showing real market traction and readiness.

• The Department of Energy - Office of Science, Office of Science in the science and technology and other research and development sector is offering a public funding opportunity titled "FY 2023 Phase II Release 1" and is now available to receive applicants.
• Interested and eligible applicants and submit their applications by referencing the CFDA number(s): 81.049.
• This funding opportunity was created on Oct 21, 2022.
• Applicants must submit their applications by Dec 06, 2022. (Agency may still review applications by suitable applicants for the remaining/unused allocated funding in 2026.)
• Each selected applicant is eligible to receive up to $1,600,000.00 in funding.
• The number of recipients for this funding is limited to 100 candidate(s).
• Eligible applicants include: Small businesses.

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