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Biden-Harris Administration Announces $63 Million to Accelerate Electric Heat Pump Manufacturing Across America as Part of Investing in America Agenda

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WASHINGTON, D.C. — As part of President Biden’s Investing in America agenda, the U.S. Department of Energy (DOE) today announced the availability of $63 million to accelerate the growth of domestic manufacturing of residential heat pumps, heat pump water heaters, and other heat pump systems and components. This investment from President Biden’s Inflation Reduction Act—invoked by President Biden’s use of emergency authority on the basis of climate change— utilizes the Defense Production Act (DPA) to increase domestic production of key clean energy technologies, including electric heat pumps. This funding opportunity builds on a successful first round of $169 million in funding to manufacturers of heat pumps and components in November 2023. Electric heat pumps are critical to lowering energy costs for families, reducing the nation’s reliance on fossil fuels, bolstering national security, and tackling the climate crisis. 

“As part of the Biden-Harris Administration’s commitment to address the climate crisis, these Defense Production Act dollars will further amp up domestic heat pump manufacturing to meet increasing consumer excitement, reduce emissions, and create clean energy jobs across the country,” said U.S. Secretary of Energy Jennifer M. Granholm. “President Biden’s Investing in America agenda is working—it’s not only making heating and cooling technology more accessible, but it’s also growing high-quality job options for workers in underserved communities and helping supercharge America’s clean energy economy.”

Heat pumps can efficiently provide heating and cooling and hot water for our homes and buildings. Because heat pumps transfer (rather than generate) heat, this technology efficiently provides comfortable temperatures for heating and cooling homes and businesses in all climates, especially when homes are well-insulated. Electric heat pumps reduce greenhouse gas emissions by up to 50% compared to the most efficient condensing gas boilers today, and this percentage could grow to 75% by 2030. Heat pump water heaters can be 2 to 3 times more energy efficient than conventional electric water heaters. Increased use of electric heat pumps, for heating and cooling (space conditioning) and water heating, will help lower energy costs for more American families and businesses and create healthier indoor spaces. 

As the U.S. builds the clean energy economy, developing the workforce to support clean energy technologies will be critical. Recognizing this need, the projects under the funding opportunity may propose using a portion of funding to develop the workforce needed to meet the facilities’ new or expanded needs. 

This program also advances the Biden-Harris Administration’s Justice40 Initiative, which sets the goal that 40 percent of the overall benefits of certain Federal climate, clean energy, and other investments flow to disadvantaged communities that are marginalized by underinvestment and overburdened by pollution.

DOE’s authority to utilize the Defense Production Act of 1950 (DPA) to ramp up production of five key clean energy technologies, including electric heat pumps, was announced by President Biden in 2022.  DOE’s Office of Manufacturing and Energy Supply Chains administers DOE’s DPA authority to build a clean energy economy, create good-paying manufacturing jobs, and help families save money on their energy bills. 

Read the full funding opportunity here. An information webinar will be held on February 21, 2024, at 2:00 pm ET, register here.  Concept papers, which are required for all applicants, are due on March 15, 2024, at 5 p.m. ET. Full applications are due on April 29, 2024, at 5 p.m. ET.   

Learn more about the MESC mission to catalyze investments in America’s energy future in support of the re-shoring, skilling, and scaling of U.S. manufacturing across energy supply chains.

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