TL/DR –
The U.S. Department of Energy (DOE) is allocating $169 million for nine projects to expedite the production of electric heat pumps across 15 sites in 13 states. The projects aim to generate over 1,700 high-quality jobs, improve air quality, and reduce energy resilience on foreign adversaries. These initiatives will contribute to the production of air-to-air, air-to-water, and geothermal heat pumps, with another round of investments expected in 2024 to secure domestic manufacturing supply chains.
Dive Brief:
- The U.S. Department of Energy has allotted $169 million for nine projects aimed at accelerating the production of electric heat pumps across 15 locations in 13 states. These projects, backed by the Defense Production Act and the Inflation Reduction Act, are predicted to collectively produce over 1,700 quality jobs, improve air quality, facilitate energy savings and reduce energy resilience on foreign adversaries.
- The projects aim to augment the production of air-to-air, air-to-water and geothermal heat pumps along with critical heat pump components like compressors and refrigerants. The DOE anticipates another round of DPA investments by early 2024 to ensure domestic manufacturing supply chains.
Dive Insight:
With over 35% of total U.S. energy consumption coming from heating and cooling essential facilities, heat pumps are vital in reducing reliance on fossil fuels. They reduce greenhouse gas emissions by up to 50% as compared to gas boilers. The nine projects, the first DOE awards since President Joe Biden invoked the Defense Production Act, aim to boost the domestic production of electric heat pumps and other clean energy technologies.
Facilities managers can further improve performance with the DOE’s investment, which is expected to reduce heat pump costs by increasing supply of pumps and components. Consumers can also benefit from additional heat pump savings available through IRA Energy Efficient Home Improvement 25C tax credits, which help afford heat pumps.
The companies receiving funding include Armstrong International, Honeywell International, Ice Air and Mitsubishi Electric. Funding will go towards critical projects such as the Mitsubishi Electric US project which plans to manufacture variable capacity compressors for high-efficiency, all-climate heat pump systems and Honeywell International who will expand its production of refrigerants. The remaining $104.2 million will be divided among the other seven projects.
The program aligns with the Biden administration’s Justice40 initiative, which aims to ensure that 40% of the overall benefits from certain federal investments in climate and clean energy reach communities dealing with underinvestment and pollution, according to the DOE.
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