US aims to speed heat pump manufacturing using Cold War-era law

By Timothy Gardner

WASHINGTON (Reuters) -The U.S. will fund nine projects with $169 million from last year’s climate bill to speed manufacturing of heat pumps, systems that can heat and cool homes and businesses more efficiently, the Energy Department said on Friday.

The awards are the first from the department’s authorization invoked by President Joe Biden using emergency authority on the basis of climate change to employ the Cold War-era Defense Production Act (DPA) to boost spending on clean energy technologies.

“Getting more American-made electric heat pumps on the market will help families and businesses save money with efficient heating and cooling technology,” Energy Secretary Jennifer Granholm said in a release.

Heating and cooling homes and buildings, including critical infrastructure like military bases, drive more than 35% of U.S. energy consumption, according to her department.  Compared to boilers fueled by natural gas, heat pumps reduce greenhouse gas emissions by up to 50%, it says.

The funding will go to manufacturers including Armstrong International in Michigan, Honeywell International in Louisiana, and Ice Air in South Carolina.

The American Gas Association (AGA), a natural gas industry group, criticized the move.

“We are deeply disappointed to see the Defense Production Act, which is intended as a vital tool for advancing national security against serious outside threats, being used as an instrument to advance a policy agenda contradictory to our nation’s strong energy position,” said AGA head Karen Harbert.

The Energy Department said it expects to unveil another round of DPA investments in early 2024.

(Reporting by Timothy GardnerEditing by Bill Berkrot)