From the Spiritual Hierarchy:

Grace in a Spiritual sense happens when an individual is given a gift (Initiation) which actually lies outside the world he is aware of.  He/She is allowed to access that gift and convert it into a Spiritual State. This Gift comes from the Spiritual Source and is channelled down through a “conduit” and bestowed upon another.

The purer the channel (conduit) the sweeter the Energy.  It is called Grace because no-one can actually ever deserve the bestowing of the Energy.  It is a gift: the ultimate Gift from God (the Source).