President Biden invokes Defense Production Act to bolster U.S. clean energy

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The administration says investing in clean energy will help save consumers money

President Biden has taken another step in his quest to make the U.S. a leader in clean energy. On Monday, he invoked the Defense Production Act (DPA) in hopes of lowering energy costs, strengthening the power grid, and creating more lucrative jobs.

“Today’s clean energy technologies are a critical part of the arsenal we must harness to lower energy costs for families, reduce risks to our power grid, and tackle the urgent crisis of a changing climate,” the White House said in an announcement. 

“Since President Biden took office, the private sector has committed over $100 billion in new private capital to make electric vehicles and batteries in the United States. We have made historic investments in clean hydrogen, nuclear, and other cutting-edge technologies. And companies are investing billions more to grow a new domestic offshore wind industry.”

What the latest action means for the consumer

This most recent move follows previous efforts by the administration to create more wind farms and produce more electric vehicle batteries. Biden feels there’s enough positive momentum in Congress’ interest on clean energy investments and tax cuts that his newest effort will create a “bridge'' to an American-made clean energy future.

The White House said the latest use of the Defense Production Act would rapidly expand American manufacturing of five critical clean energy technologies:

  • Solar panel parts (such as photovoltaic modules and module components)

  • Building insulation

  • Heat pumps

  • Equipment for making and using clean electricity-generated fuels, including electrolyzers, fuel cells, and related platinum group metals

  • Critical power grid infrastructure (like transformers)

The Biden-Harris Administration said all jobs that come as a result of this move will encourage the use of strong labor standards and make sure all wages are set at or above the prevailing rate and include local hire provisions. 

What’s to gain vs. what’s to lose

Biden’s team says his initiatives will lead to more domestic manufacturing, construction projects, and good-paying jobs, all of which will contribute to energy savings for families and a stronger utility grid. 

In its announcement, the White House said consumers will suffer if Congress fails to pass tax cuts or approve the investments that are necessary to advance U.S. clean energy. 

“Failing to take these actions would deny consumers access to cost-cutting clean energy options, add risks to our power grid, and stall domestic clean energy construction projects that are critical to tackling the climate crisis,” the administration stated. “At the same time, President Biden will keep using his executive authority to take bold action to build an American-made clean energy future."

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