ICYMI: The Biden-Harris Administration Announces $169 Million to Accelerate Electric Heat Pump Manufacturing in the US

WIRED: You Need a Heat Pump. Soon You'll Have More American-Made Options
The Biden administration is announcing $169 million to supercharge domestic production of a device beloved by climate and energy nerds.
[Matt Simon, 11/17/23]

Solar panels and wind turbines get all the attention, but an underappreciated device is helping slash emissions in a big way: the heat pump. Instead of generating heat by burning natural gas, like a furnace does, an electric heat pump extracts warmth from outdoor air and transfers it inside. In the summer the device reverses, pumping indoor heat out to cool the building.

Sales of heat pumps are booming all over the world; some 4 million were installed in the US in 2021, up from 1.7 million in 2012. The US Department of Energy is hoping to juice those numbers even more, with an announcement today of $169 million in federal funding for domestic heat pump manufacturing. Funded by the Inflation Reduction Act—the huge climate bill passed last year that also provides tax credits for heat pumps—the awards will go toward nine projects across 13 states, creating 1,700 jobs.

"Getting more American-made electric heat pumps on the market will help families and businesses save money with efficient heating and cooling technology," US secretary of energy Jennifer Granholm wrote in a Department of Energy statement provided to WIRED. "These investments will create thousands of high-quality, good-paying manufacturing jobs and strengthen America's energy supply chain."

The Biden administration is making the move by invoking the Defense Production Act, a provision that allows the president to spur the manufacture of materials needed for national defense. In this case, according to a press release, the administration is "using emergency authority on the basis of climate change." The Biden administration has previously used the DPA to speed up the production of integrated circuits and Covid vaccines. Before that, the Trump administration invoked it to boost the production of personal protective equipment during the early days of the pandemic.

"The president is using his wartime emergency powers under the Defense Production Act to turbocharge US manufacturing of heat pumps for a multitude of reasons," says Ali Zaidi, assistant to the president and national climate adviser. The first is to improve energy security by reducing reliance on international supply chains, like for components, he says. And because heat pumps are electric, they aren't subject to swings in fossil fuel prices. "This is our opportunity to make our families more resilient in the face of global energy volatility," Zaidi adds. "The way we unlock that is by bringing home the supply chains for technologies like heat pumps."

The DOE's nine projects, across 15 sites, cover the domestic production of both the pumps and their individual components. So in Three Rivers, Michigan, Armstrong International will boost its manufacturing capacity of industrial heat pumps, while in Detroit, Treau (aka Gradient) will make smaller units for homes. Money will also go toward producing the compressors used in the devices, plus refrigerants, in states like Missouri, Louisiana, and Ohio.

The funding will also be used for manufacturing geothermal heat pumps, a neat twist on the device that essentially turns a backyard into a battery. Instead of extracting heat from outdoor air, these use buried pipes to tap into the thermal properties of the ground. Once these pipes get four or five feet deep, the temperature stays fairly stable throughout the year, so the dirt is warmer than outdoor air during the winter and cooler than it in the summer.

Climate and energy nerds love heat pumps, because exchanging heat is much more efficient than generating it. Since these devices are electric, they can be powered with clean energy. With better insulation and windows, heat pumps become even more powerful tools, further reducing the costs of climate control. (And contrary to what detractors might say, they can draw heat even from frigid air. Look no further than Maine, where this July the government announced that it reached its goal to install 100,000 heat pumps two years ahead of schedule.)

Heat pumps are so efficient, in fact, that even if they're powered by fossil fuels, "it's still a big upgrade," Duncan Gibb, lead analyst for heating and buildings at REN21, which advocates for renewables, told WIRED last year. "There's really nothing to lose by making buildings more efficient as quickly as possible and deploying heat pumps."

They work for commercial buildings, too, in versions that are scaled up from residential designs. Combined, residential and commercial buildings accounted for 40 percent of US energy consumption in 2022.

But as more heat pumps roll off the assembly line, the nation will need workers to install them—and more broadly to retrofit the aging electrical grid that powers them. That's going to require huge training programs. "The green transition is going to generate upwards of 25 million new jobs [in the US] in the next 15 years—this is just going to be a tremendous transformation of the US workforce," Mark Paul, an environmental economist at Rutgers University, told WIRED earlier this year. "You can't outsource the installation of heat pumps or solar panels on somebody's roof to China or Bangladesh."

Zaidi points to the Biden administration's launch of the American Climate Corps in September, a rebirth of the Civilian Conservation Corps that put people to work during the Great Depression. This time around, the corps will employ more than 20,000 Americans to do climate adaptation tasks like managing forests and making buildings more energy efficient. "We will need to step up our training of new workers to join the ranks of union members all across the country who are already helping deploy these technologies at scale," says Zaidi. "Our unions are up to the task. Our community colleges are up to the task. And our young people are hungry to be part of this effort."