Sign In or Create an Account.

By continuing, you agree to the Terms of Service and acknowledge our Privacy Policy

Economy

The Heat Pump Manufacturing Boom is About to Begin

The Biden administration announces $169 million in grants to boost production of the technology in America.

President Biden and a heat pump.
Heatmap Illustration/Getty Images

When Russia invaded Ukraine in February 2022, American environmentalist and writer Bill McKibben pitched an idea to sap Russia’s power by drying up the market for its oil and gas. Heat Pumps for Peace and Freedom, he named the proposal, which called on President Biden to use his wartime emergency powers to ramp up manufacturing of electric heating appliances so that households could replace their fossil fuel-based furnaces.

Remarkably, Biden obliged. Just a few months later, he authorized the use of the Defense Production Act to expand American manufacturing of electric heat pumps, deeming them essential to national security. Now, a year and a half later, money is finally going out the door. On Friday, the Department of Energy announced $169 million in grants for nine companies that will invest in projects to boost domestic production of heat pumps.

“More than 40% of all U.S. [energy] consumption comes from homes, offices, schools, other buildings,” said Department of Energy Secretary Jennifer Granholm during a virtual event promoting the projects on Friday. “The problem is that we rely heavily on other countries for the oil and gas that heat and cool these buildings, and transitioning to American-made heat pumps makes us more secure.”

Granholm also noted that some 40% of heat pumps purchased here are made in China. “Today’s announcement means that we can chip away at that market and put America on a path to dominating it,” she said.

The manufacturing grants will ensure there’s supply to meet growing demand for heat pumps spurred by the Inflation Reduction Act, which created a number of incentives for building owners to install them. Many states are also creating their own programs and incentives to spur heat pump adoption as part of their climate plans.

“This is meeting demand that’s taken off all across the country,” said White House national climate advisor Ali Zaidi during the event, noting that a coalition of governors have collectively set a goal to deploy 20 million heat pumps by 2030. “That’s a massive expansion.”

The projects span 13 states and support a range of technologies. The largest grant, at $50 million, went to Mitsubishi to build a new factory in Kentucky that will make “variable capacity compressors,” which are essential components in the best performing, most efficient heat pumps on the market. Honeywell received $15 million to expand one of its existing facilities in Louisiana to increase annual production of a refrigerant that has a lower global warming potential than what’s used in many existing models.

A $17.5 million grant is going to a startup called Gradient to build its first factory in Detroit, Michigan, with a capacity of 100,000 units per year. Gradient specializes in producing heat pumps that can be installed in the window, similar to an air conditioner, and don’t require an electrician or plumber. The company was also selected by New York state to supply heat pumps for New York City’s public housing.

A company called Johnson Controls plans to use a $33 million grant to retrofit three of its factories in Kansas, Texas, and Pennsylvania, to increase the number of and types of heat pumps it produces. It anticipates producing more than 200,000 heat pumps per year, “an enormous increase” over the company’s 2023 production, according to the Department of Energy.

The grants will also support the production of different kinds of heat pumps. A company called Armstrong International based in Michigan will build a new facility to manufacture industrial versions that can produce the high heat needed to replace natural gas boilers in food manufacturing and paper and pulp plants. This can reduce the energy use associated with industrial heating by up to one third, according to one estimate, cutting emissions by 30 to 43 million tons per year.

Granholm said the grants would bring down the cost of heat pumps by boosting supply. It can cost homeowners anywhere from a few thousand dollars to upwards of $20,000, even with federal and state incentives, to swap out a natural gas boiler for a heat pump — a major impediment to wider adoption.

Stephen Pantano, the head of market transformation at Rewiring America, a nonprofit that advocates for electric appliances, was optimistic that the grants would help. “If you’re working with a domestic supplier, there’s an incentive for the builder and the component supplier to align and work together on product design and make products that are better suited for the U.S. market,” he said. “You also don’t have import duties and shipping costs and a lot of the other stuff that you have to deal with when you’re sourcing things internationally,” he said.

The grants are also expected to spur an estimated 1,700 jobs at the manufacturing facilities, as well as deliver investments to community colleges and apprentice programs for workforce development.

The Department of Energy said it plans to issue another round of Defense Production Act grants in the new year. The heat pump manufacturing boom is officially underway.

You’re out of free articles.

Subscribe today to experience Heatmap’s expert analysis 
of climate change, clean energy, and sustainability.
To continue reading
Create a free account or sign in to unlock more free articles.
or
Please enter an email address
By continuing, you agree to the Terms of Service and acknowledge our Privacy Policy
Politics

The Messaging War Over Energy Costs Is Just Beginning

The new climate politics are all about affordability.

Donald Trump, a wind turbine, and money.
Heatmap Illustration/Getty Images

During the August recess, while members of Congress were back home facing their constituents, climate and environmental groups went on the offensive, sending a blitz of ads targeting vulnerable Republicans in their districts. The message was specific, straightforward, and had nothing to do with the warming planet.

“Check your electric bill lately? Rep. Mark Amodei just voted for it to go up,” declared a billboard in Reno, Nevada, sponsored by the advocacy group Climate Power.

Keep reading...Show less
Green
Climate

AM Briefing: EPA Muddies The Waters

On fusion’s big fundraise, nuclear fears, and geothermal’s generations uniting

EPA Prepares to Gut Wetland Protections
Heatmap Illustration/Getty Images

Current conditions: New Orleans is expecting light rain with temperatures climbing near 90 degrees Fahrenheit as the city marks the 20th anniversary of Hurricane Katrina • Torrential rains could dump anywhere from 8 to 12 inches on the Mississippi Valley and the Ozarks • Japan is sweltering in temperatures as high as 104 degrees.

THE TOP FIVE

1. EPA plans to gut the Clean Water Act

The Environmental Protection Agency is preparing to propose a new Clean Water Act rule that would eliminate federal protections for many U.S. waterways, according to an internal presentation leaked to E&E News. If finalized, the rule would establish a two-part test to determine whether a wetland received federal regulations: It would need to contain surface water throughout the “wet season,” and it would need to be touching a river, stream, or other body of water that flows throughout the wet season. The new language would require fewer wetland permits, a slide from the presentation showed, according to reporter Miranda Willson. Two EPA staffers briefed on the proposal confirmed the report.

Keep reading...Show less
Yellow
Spotlight

Birds Could Be the Anti-Wind Trump Card

How the Migratory Bird Treaty Act could become the administration’s ultimate weapon against wind farms.

A golden eagle and wind turbines.
Heatmap Illustration/Getty Images

The Trump administration has quietly opened the door to strictly enforcing a migratory bird protection law in a way that could cast a legal cloud over wind farms across the country.

As I’ve chronicled for Heatmap, the Interior Department over the past month expanded its ongoing investigation of the wind industry’s wildlife impacts to go after turbines for killing imperiled bald and golden eagles, sending voluminous records requests to developers. We’ve discussed here how avian conservation activists and even some former government wildlife staff are reporting spikes in golden eagle mortality in areas with operating wind projects. Whether these eagle deaths were allowable under the law – the Bald and Golden Eagle Protection Act – is going to wind up being a question for regulators and courts if Interior progresses further against specific facilities. Irrespective of what one thinks about the merits of wind energy, it’s extremely likely that a federal government already hostile to wind power will use the law to apply even more pressure on developers.

Keep reading...Show less
Yellow