Biden Makes Another Move Against Gas Appliances: Invokes Wartime Defense Production Act to Fund Electric Heat Pumps

President Biden invoked a Cold War-era law Friday to utilize taxpayer money to fund domestic manufacturing of electric heat pumps as an alternative to gas-powered residential furnaces.

Biden’s utilization of the 1950 Defense Production Act (DPA) has sparked significant controversy. In a joint announcement with the White House, the Department of Energy (DOE) stated the initiative would allocate “$169 million for nine projects across 15 sites nationwide.”

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

She further argued, “These investments will create thousands of high-quality, good-paying manufacturing jobs and strengthen America’s energy supply chain, while creating healthier indoor spaces through home-grown clean energy technologies.”

John Podesta, the White House clean energy czar, sees this as a crucial step in addressing climate change, stating, “Today’s Defense Production Act funds for heat pump manufacturing show that President Biden is treating climate change as the crisis it is.” He added, “These awards will grow domestic manufacturing, create good-paying jobs, and boost American competitiveness in industries of the future.”

Ali Zaidi, Biden’s national climate advisor, emphasized the President’s commitment to using his “wartime emergency powers under the Defense Production Act to turbocharge U.S. manufacturing of clean technologies and strengthen our energy security.”

Under the initiative, DOE will send millions of dollars to companies that are already billion-dollar global corporations like Honeywell International, Mitsubishi Electric, Copeland, and York International Corporation. The projects are meant to advance the manufacturing of residential, commercial and industrial heat pump technology.

Critics, however, are skeptical of the program. Ben Lieberman, a senior fellow at the Competitive Enterprise Institute, criticized the allocation of funds, saying, “This is absolutely shameful corporate welfare. But we’re to believe that, because it’s for the sake of climate change, all is well. I think that’s ridiculous.”

Do you think Biden should be allowed to use a wartime act for appliance production in peacetime?

Lieberman argued, “Of all the Biden administration’s claimed climate emergency declarations, this may be the craziest of them all.”

“There is no shortage of heat pumps — it’s just that not every homeowner wants them,” Liebrman said, raising concerns about government intervention. “Consumers ought to decide for themselves. The government has no role in tilting the balance in favor of one energy source over another. That’s clearly what’s happening here.”

This move by the Biden administration comes on the heels of new regulations issued by the Department of Energy (DOE) aimed at traditional gas-powered home furnaces. These regulations, set to take effect in 2028, require furnaces to achieve an annual fuel utilization efficiency (AFUE) of 95%. The current market standard AFUE for a residential furnace is 80%.

Karen Harbert, President and CEO of the American Gas Association, expressed disappointment over the use of the Defense Production Act for this purpose. She said, “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.”

“Increased use of natural gas has been responsible for sixty percent of the electrical grid’s CO2 emissions reductions,” Harbert continued. “This vital tool for emissions reductions and energy system resilience should not be unfairly undermined through misuse of the Defense Production Act.”

It’s worth noting that the Defense Production Act, passed during the Cold War, grants the president wide-ranging authorities to influence domestic industry in the interest of national defense. President Biden has previously invoked this law to expedite domestic critical mineral production and suspend tariffs on Chinese solar panel imports, citing climate change as a national emergency.

In addition to the focus on furnaces, the DOE has been actively rolling out new standards for various household appliances in recent months, including gas stoves, clothes washers, refrigerators, and air conditioners. According to the DOE, these regulations, both past and planned, are projected to result in $570 billion cost savings for Americans and significant reductions in greenhouse gas emissions by more than 2.4 billion metric tons over the next three decades.

What the administration fails to address over and over in all of these regulations is the actual cost of the “upgrades” to Americans and where on earth is all the electricity to run these “clean” appliances going to come from.

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