DOE prepared this EA to evaluate the potential environmental consequences of providing a financial assistance grant under the American Recovery and Reinvestment Act of 2009 in a cooperative agreement with the Beacon Power Corporation (Beacon Power) as part of the Smart Grid Demonstrations Program. This EA evaluates two similar proposed projects in two locations: Site 1 evaluates installation of a utility-scale 20-megawatt flywheel energy storage and frequency regulation plant in Chicago Heights, Illinois, to provide frequency regulation services to PJM Interconnection, the electrical grid operator. The cost of the proposed project at the Illinois location would be about $48.1 million. Site 2 evaluates installation of the same system in Hazle Township, Pennsylvania. The cost of the proposed project at the Pennsylvania location would be about $53 million. DOE could choose to provide a grant for either location. DOE's Proposed Action would provide approximately $24 million in financial assistance in a cost-sharing arrangement to Beacon Power. In addition, for the proposed project in Pennsylvania (Site 2), Beacon Power could receive a $5 million grant from Pennsylvania's Redevelopment Capital Assistance Program. This EA evaluates the environmental resource areas DOE commonly addresses in its EAs and identifies no significant adverse environmental impacts for the proposed project. The proposed projects could result in beneficial impacts to the nation's energy efficiency and the local economy, and could contribute to a minor reduction of greenhouse gases.