The Biden-Harris Administration has announced nearly $85 million in funding to accelerate domestic heat pump manufacturing. The funds, part of the Investing in America agenda and authorized by President Biden through the Defense Production Act (DPA), aim to boost U.S. manufacturing, create clean energy jobs, and lower energy bills nationwide while enhancing national security.
The U.S. Department of Energy (DOE) disclosed that the funding will be distributed among four heat pump manufacturers to support projects at five factories located in New York, Tennessee, Texas, and Rhode Island. These initiatives are expected to create over 500 jobs, including 220 positions in disadvantaged communities.
"Extreme weather events are harming our grid and serving as a primary driver of higher electricity bills, underscoring the need to increase access to energy-efficient technologies," stated U.S. Secretary of Energy Jennifer M. Granholm. "The Biden-Harris Administration’s Investing in America agenda is manufacturing hundreds of thousands of energy-saving heat pumps here in the USA, helping American households and businesses keep money in their pockets all while strengthening our national security and creating good-paying jobs."
White House National Climate Advisor Ali Zaidi remarked, "Under President Biden and Vice President Harris’s leadership, the United States is supercharging U.S. clean energy manufacturing... Today's investments harness the power of American innovation to jumpstart critical clean energy manufacturing capacity and protect our families, our economy, and our planet."
These DPA investments aim to enhance American production of heat pump technologies used for heating and cooling spaces as well as water heating for various facilities. The initiative will also boost domestic production of compressors—a key component often manufactured overseas—facilitating their use in American-made heat pumps.
The DOE's announcement aligns with broader consumer savings initiatives under the Investing in America agenda. Homeowners can now receive up to a 30% federal tax credit on purchasing and installing a heat pump, alongside state-funded home energy rebate programs.
Heat pumps account for more than one-third of greenhouse gas emissions from building heating and cooling systems across the United States. They can reduce these emissions by up to 50% compared to efficient gas boilers today, potentially reaching 75% reduction by 2030. Heat pump water heaters are two-to-three times more efficient than conventional electric models, saving homeowners between $300 to $1,500 annually.
As negotiations proceed with selected manufacturers, DOE will mandate job quality standards consistent with community benefit agreements. These may include high wages, comprehensive health insurance, retirement contributions, paid time off, family care services, transportation support, and unionization rights.
Selection for award negotiations does not guarantee funding; it is contingent on successful negotiations and environmental reviews.
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