US Mulls Invoking Defense Production Act to Spur Local Clean Energy Industry
The DOE aims to cut down imports and strengthen the domestic energy industrial base
October 7, 2022
The U.S. Department of Energy (DoE) has announced a request for information (RFI) inviting comments to determine how it can best utilize the Cold War-era Defense Production Act to spur domestic production of clean energy technologies and strengthen grid reliability.
The request seeks public input on the supply chain challenges and opportunities, domestic manufacturing, small and medium-scale workforce investment, energy equity, community access, and economic benefit. The responses to the RFI are to be submitted by November 30, 2022.
U.S. President Joe Biden invoked the authority granted by the statute in an attempt to increase manufacturing output and clean energy deployment. Biden has authorized the DOE to use the law to rapidly expand U.S. manufacturing of solar panels, building insulation, heat pumps, clean electricity-generated fuels, and power grid infrastructure like transformers.
“The Defense Production Act provides us with a vital tool to make targeted investments in key technology areas that are essential,” said U.S. Secretary of Energy Jennifer M. Granholm.
“DOE is eager to continue hearing ideas from industry, labor, environmental, energy justice, and state, local, and tribal stakeholders about how we can best use this powerful new authority to support the clean energy workforce and technologies needed to combat climate change,” she added.
The DOE said it could pursue several approaches under the Defense Production Act authority to strengthen U.S. supply chains, including purchases, purchase commitments, and financial assistance.
As countries globally are battling the global supply disruption to the ongoing war in Ukraine and the post-COVID-19 recovery period, the U.S. aims to build on its domestic energy industrial base, cut dependency on imports, and strengthen grid reliability and resilience, which in turn will contribute to the country’s economy and national defense.
With the recently introduced Inflation Reduction Act (IRA) and Biden’s commitment toward growing a quintessentially “made in America” clean energy industry, the country has spurred billions in investment from private companies in solar, offshore wind, electric vehicle plants, and batteries, with additional investments on the way.
The DOE plans to use $250 million of funds appropriated by the IRA to support Defense Production Act investment in the fifth technology part of the President’s announcement on heat pump manufacturing and deployment.
According to a Lawrence Berkeley report, nearly 12.5 GW of new utility-scale solar capacity came online in the U.S. in 2021, taking the cumulative capacity to 51.34 GW across 1,131 projects.
Recently, DOE released a new roadmap and awarded $24 million to ten research teams to advance next-generation concentrating solar-thermal power technologies.