Department of Energy to award $6B toward decarbonization projects

The Biden-Harris administration, through the U.S. Department of Energy (DOE), has announced plans to release $6 billion in funding through its Industrial Demonstrations Program to accelerate decarbonization projects in energy-intensive industries and provide American manufacturers a competitive advantage in the global clean energy economy.

According to a news release from the DOE, the funding is part of President Biden’s Bipartisan Infrastructure Law and Inflation Reduction Act. The Industrial Demonstrations Program will focus on helping high-emitting industries where decarbonization technologies will have the most impact, such as iron, steel, aluminum, cement and other energy-intensive industrial processes.

The DOE reports that the industrial sector contributes nearly one-third of the nation’s carbon emissions. The DOE says deploying decarbonization projects within these industries is part of the president’s goal to achieve a net-zero economy by 2050 as well as strengthen domestic manufacturing capabilities.

“Today’s announcement is yet another exciting step in the race to fully decarbonize our heavy industries and will help drastically reduce harmful pollution while ensuring America’s manufacturing sector is strong and competitive,” says U.S. Secretary of Energy Jennifer M. Granholm. “President Biden’s transformational investments in innovation and clean energy are supporting American industries as they create new economic opportunities across the country while leading the world in clean manufacturing technologies.” 

According to the DOE, the Office of Clean Energy Demonstrations, in collaboration with the Office of Manufacturing and Energy Supply Chains and the Industrial Efficiency and Decarbonization Office, manages this program and will provide up to 50 percent of the cost of each project funded. The DOE says this funding includes $430 million from the Bipartisan Infrastructure Law and $5.46 billion from the Inflation Reduction Act.

DOE says it is seeking first-of-a-kind or early-stage commercial-scale projects to fund through the Industrial Demonstrations Program and expects to award projects from the highest-emitting industries involving cross-cutting technologies that have the greatest potential, directly or indirectly, to achieve decarbonization domestically and globally. Additionally, the DOE says it is prioritizing a portfolio of projects that accelerate industry toward deep decarbonization; spur follow-on investments for widespread adoption of the demonstrated technologies; enable new markets for cleaner products; and benefit local communities.

Several industry associations have expressed support for this funding announcement, including the Washington-based Aluminum Association.

“The Aluminum Association applauds the Biden administration’s commitment to support additional decarbonization of aluminum and other energy-intensive manufacturing sectors,” says Charles Johnson, president and CEO of the Aluminum Association. “The North American aluminum industry is already among the lowest emitting regions in the world. Aluminum and aluminum products made here have significantly lower impact than similar products made in China, the Middle East and elsewhere. And the next generation of low-carbon smelting technology is being developed right here in North America. But there is much more work to be done. Critical federal investments like those announced today will help as the domestic aluminum industry innovates to become ever more sustainable and competitive in the coming years.”

The DOE says interested applicants must submit a Community Benefits Plan to ensure they are meaningfully engaging with surrounding communities; creating quality jobs; advancing diversity, equity, inclusion and accessibility; and supporting environmental justice. DOE says, “This will help ensure these projects are not causing harm but instead providing tangible benefits to communities that too often have been left behind.”

DOE says concept papers are due April 21 and full applications are due Aug. 4.