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On November 15, 2021, President Biden signed a $1.2 trillion Infrastructure Investment and Jobs Act into law. This bill first came across the House on November 5th and was passed by both parties.
Another bill, the Build Back Better Act, is a $1.75 trillion economic and climate package that would dedicate “about $550 billion over 10 years for clean energy and climate programs”1 but this has not yet passed and is currently still in discussions.
While the Build Back Better Act and the Infrastructure Investment and Jobs Act were following the same direction as related to clean energy and climate change, only the latter was passed. What does the passing of this bill mean for the energy and lighting industry moving forward?
The Funding Breakdown
With the $1.2 trillion bill approved, the bill includes “about $65 billion for grid infrastructure and $50 billion for cyber and climate resilience over five years”.1 With those funds, items being discussed are related to the grid and carbon reduction including hydropower, solar, and additional clean energy alternatives. This bill also allocates over $50 million toward energy efficiency initiatives for commercial buildings and building upgrades for nonprofit organizations.
Clean Energy and Climate Change
President Biden stated that this bill will make it possible to get into the “game of manufacturing solar panels, wind turbines, batteries to store energy and power for electric vehicles, including electric school buses”.1 As discussed at COP26, the United States was to implement goals for net zero greenhouse gas emissions with 2030 and 2050 deadlines. The items discussed in this bill, seem to have a focus on energy alternatives that could push along these goals.
Grid
With over $65 billion allocated, grid and power are of the main highlights of this bill.
Within the bill is the Energy Infrastructure Act which includes:
“funds for grid reliability and resiliency and support for a Grid Deployment Authority; critical minerals and supply chains for clean energy technology; key technologies like carbon capture, hydrogen, direct air capture, and energy efficiency; and energy demonstration projects from the bipartisan Energy Act of 2020”.2
The Energy Act of 2020 was signed to “phase out hydrofluorocarbons, greenhouse gases with extremely high warming potential.”3 Within Title X of this bill, there was also funding allocated throughout 2022 to 2025 for “renewable energy demonstration projects including $84,000,000 for enhanced geothermal systems, $100,000,000 for wind energy, and $80,000,000 for solar energy authorized by the Energy Act of 2020.”2
Carbon Reduction
The bill pushes a large focus on carbon reduction including electric vehicles with the addition of electric vehicle chargers in underserved communities and highways, as well as the focus on electric school buses.
Other allotments related to carbon reduction include1:
- $8 billion to set up at least four "clean" hydrogen hubs;
- $6 billion in subsidies for uneconomic nuclear power plants;
- $3.5 billion to establish four hubs for removing carbon dioxide from the air; and,
- $2.1 billion for a loan program for carbon dioxide transportation.
Related back to infrastructure, there is a carbon reduction program to reduce emissions from transportation. This section highlights traffic monitoring, advanced truck stop electrification systems as well as the development of “on-road and off-road trail facilities”2 for carbon-free modes of transportation including bicycling and walking.
Another means of carbon reduction is investing into various energy alternatives including hydropower, solar, hydrogen, and nuclear power, all of which this bill dived into. Under Title III of the infrastructure bill is the Fuels and Technology Infrastructure Investments which dives deeper into a few alternatives.
Included in Subtitle D of Title III, is exploring hydropower which includes “$125,000,000 for hydroelectric production incentives [and] $75,000,000 for hydroelectric efficiency improvement incentives”2 for the fiscal year 2022. There is also to be $10 million allocated from 2022 to 2026 to “establish a demonstration project for a pumped storage hydropower project to facilitate the long-duration storage of intermittent renewable electricity.”2
Within Subtitle B of Title III, there is over $8 billion allotted through 2022 to 2026 for the “processing, delivery, storage, and end-use of clean hydrogen.”2 Another $500 million is allotted to “a clean hydrogen manufacturing and recycling program to support a clean hydrogen domestic supply chain.”2 These are in place to develop and create a clean hydrogen economy.
Nuclear energy was also discussed within Subtitle C of Title III as the Department of Energy will “develop a report on the feasibility for using nuclear energy to meet resilience and carbon reduction goals.”2
Former mine land is also brought into the discussion as under Subtitle E discusses potential solar energy technologies and clean energy demonstration programs on former mine land. For the clean energy demonstrations, over $500 million is allocated from 2022 to 2026 to “demonstrate the technical and economic viability of carrying out clean energy projects on current and former mine land in a compatible manner with any existing operations.”2
The Department of Energy will also create a report to determine “the viability of siting solar energy on current and former mine land, including necessary interconnection, transmission siting, and the impact on local job creation.”2
While the majority of these funds allocated from this bill are into the research of clean energy technologies, this bill also prioritizes energy efficiency for commercial buildings.
Commercial Buildings and Energy Efficiency
Though clean energy and the energy industry are the primary focus of this bill, the lighting industry could also see benefit from Title V under Energy Efficiency and Building Infrastructure.
Title V includes $550 million for funding throughout 2022 to 2026 to “identify opportunities for optimizing energy efficiency and environmental performance at manufacturing and other industrial facilities.”2 This increased focus on energy optimization could be the catalyst for more retrofit project opportunities for lighting and controls manufacturers.
Within this bill is the Surface Transportation Reauthorization Act of 2021 which states “including retrofitting dedicated short-range communications (DSRC) technology, a project to replace street lighting and traffic control devices with energy-efficient alternatives.”2
There is also mention of Schools and Nonprofits within the bill, that will award grants “to provide nonprofit buildings with energy-efficiency materials.”2 For lighting manufacturers, this could lead to lighting improvement projects, as well as the implementation of controls.
Under Title X, Subtitle E, this bill also includes $20,000,000 in rebates allocated towards “the extended product system rebate program and the energy efficient transformer rebate program” throughout 2022 to 2023.
Need help with rebate incentives? Encentivizer is a suite of tools that helps LED manufacturers, utilities, and energy efficiency professionals access or provide utility rebate estimates and program information for qualified products→ Learn more about Encentivizer
The Future
While the majority of funding for this bill is allocated towards research when it comes to clean energy technologies and how to improve energy efficiency within commercial and school buildings, this bill will have a major impact on the energy and lighting industries.
With the discussion of climate change and a goal of reaching net zero greenhouse gas emissions, exploring clean energy alternatives including nuclear, hydropower, and other carbon reductions, what research shows will be something to keep an eye on.
There is also discussion of the other $1.75 trillion economic and climate package that could make an impact on these industries as part of the Build Back Better Act. While this bill is still in discussions, it could provide an even greater impact towards clean energy and climate programs.
Sources
1 Biden signs $1.2 trillion infrastructure bill with funding for EVs, transmission, hydrogen
