Biden Uses War-Time Law to Fund Heat Pumps Citing Climate Crisis

(Bloomberg) -- The Biden administration is using the emergency powers of a Cold War-era law to fund more domestic manufacturing of electric heat pumps, which the White House says is needed to help stave off climate change and increase domestic security. 

The Energy Department announced Friday it was using the 1950s Defense Production Act for a $169 million award for 9 projects across the country by companies such as Honeywell International Inc. and Copeland LP to accelerate production of heat pumps and components.

Electric heat pumps, a greener alternative to conventional furnaces, are needed to reduce the nation’s reliance on fossil fuels and increase energy independence, according to the Energy Department. Heating and cooling buildings, according to the department, are responsible for more than 35% of US energy consumption. 

The Defense Production Act was harnessed by President Harry Truman to make steel for the Korean War and to spur mask production during the coronavirus pandemic by former President Donald Trump who also invoked the law to prop-up money-losing coal plants. 

The Energy Department said it plans to use the law for another round of spending in 2024 to secure domestic manufacturing supply chains and that last year it was considering using the emergency powers to boost production of solar panels, transformers and hydrogen fuel cells.

“Today’s Defense Production Act funds for heat pump manufacturing show that President Biden is treating climate change as the crisis it is,” said John Podesta, the president’s senior adviser on clean energy.

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