Clean Energy Ignites New Era in Midwest American Manufacturing

TL/DR –

The Midwest is becoming a significant hub for clean energy manufacturing, following the passing of the Inflation Reduction Act by Congress in August 2022, which provides tax credits for clean energy-related projects and purchases. This has led to about $30 billion in private investments in Midwestern states for the domestic production of electric vehicles, batteries, and equipment for solar and wind farms. States such as Michigan, Indiana, and Ohio have received $11.6 billion, $7.8 billion, and $7 billion respectively, leading to an increase in clean energy manufacturing jobs by 18% in Michigan, 17% in Indiana, and 18% in Ohio.

Midwest Emerges as Major Hub for Clean Energy Manufacturing

With federal incentives and falling renewable energy prices, the Midwest is becoming a central hub for clean energy manufacturing. Companies are investing billions into new factory operations, bolstered by the Inflation Reduction Act’s tax credits for clean energy projects. Since its passing in August 2022, about $30 billion in private investments have been pumped into Midwestern states to ramp up production of electric vehicles, batteries and solar and wind farm equipment, according to E2’s monthly funding tally.

Midwest States Receive Substantial Investments

Michigan, Indiana and Ohio have been major recipients, securing $11.6 billion, $7.8 billion and $7 billion respectively for clean energy projects between August 2022 and April this year. Michigan and Indiana now surpass Texas in such funding, with Michigan overtaking Georgia for the total number of large-scale clean energy projects.

Rise of Clean Energy Manufacturing Jobs

“A new era in American manufacturing is unfolding as it transitions to clean energy,” states E2’s Communications Director Michael Timberlake. He attributes this rise to the region’s history as the heart of U.S. industry, making it an attractive location for companies to expand manufacturing operations. Since 2022, clean energy manufacturing jobs increased by 18% in Michigan, 17% in Indiana, and 18% in Ohio, with electric vehicles fast approaching as the second biggest employer in the U.S. clean energy sector.

Electric Vehicles Bolster Midwest Manufacturing

Historically industrial cities like Detroit are seeing a resurgence with clean energy projects, with at least eight of Michigan’s 29 large-scale clean energy projects announced since 2022 located in or near the city. This includes a $35 million electric vehicle battery plant planned by an Australian company. Despite a recent slow down in sales, electric vehicles remain the fastest-growing category for car sales in the U.S, making up 7.6 percent of total vehicle market in 2023.

Investments in EV Manufacturing

Last month, Toyota announced a $1.4 billion investment to expand its EV manufacturing operations in Princeton, Indiana, creating 340 new jobs. In 2023, LG and Honda began construction on a $4.4 billion jointly owned plant for electric vehicle batteries in Jeffersonville, Ohio, anticipated to create 2,200 new jobs.

The Future of Clean Energy in America

While the Midwest is seeing substantial growth, the South and Southeast have received the majority of capital investments since 2022, positioning the region to become the nation’s leading green energy hub. However, Timberlake emphasizes that the Midwest is a close second, promising an exciting future for clean energy in America.

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