August -> September , 2024

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Welcome back from the long weekend – I hope everyone had a great summer!

August’s clean tech news was dominated by the two year anniversary of the Inflation Reduction Act. We’re celebrating with a special IRA Deep Dive issue with tons of fun charts and data you never knew you needed about the IRA.

The Treasury Department marked the occasion by releasing a trove of info on the law’s uptake and a clearing house of IRA guidance and regulations on the law’s 26 new or modified clean energy tax credits. I started DCCleanTech because I wanted all the USG cleantech funding and policy information in one place, so I’m a huge fan of this Treasury data dump and it immediately earned a spot on the bookmark bar.

A tireless effort

The Administration has done a truly impressive amount of work to translate the IRA’s tax incentives into rules and regulations that investors can bank on. Sure, there are some high-profile credits awaiting final rules, but the Administration has put in a herculean effort over the past two years to implement the law.

📹DOE alone has produced more than 10 hours of webinars and videos to help investors and technology developers understand how to take advantage of various tax incentives.
✍️Stakeholders have contributed more than 63,000 comments (nearly half of these for the 45V clean hydrogen credit).
📚Treasury has issued more than 3,000 pages of guidance, rules, FAQs, Revenue Procedures, Requests for Comments, and temporary, proposed, and final rules. In terms of page count, over the last 2 years Administration bureaucrats have written an IRA magnum opus that is 3 times the volume of “War and Peace” (or as it was originally titled, “War, What is it Good For” … Absolutely nothin!)

And those numbers reflect just a fraction of the work that goes into each tax credit. To take you behind the scenes, each tax credit regulation also includes press releases, blog posts, talking points for senior administration officials to brief the media, and for use in meetings with key stakeholders in industry, NGOs, and Congress. Some tax credits have implications for our international partners and allies, and the Administration will prepare briefings with embassies and guidance that gets cabled out to U.S. diplomats around the world. All this paper needs to be reviewed by subject matter experts, public affairs specialists, and of course, lawyers.

You can quibble with the substance - there are certainly elements of several tax credit regulations that could be improved– but this incredible output is a testament to the dedication and sacrifice of the Administration’s IRA policy team and I hope they can take a moment to reflect on everything they accomplished over the past two years.

Outperforming Expectations

💰Treasury has some evidence from 2023, the first full year of returns, to show that the hard work is paying off. The IRS announced that a whopping $8.4 billion was claimed on the Home Energy Efficiency and Energy Property tax credits in 2023, crushing the original official estimate of $2.3 billion. Those numbers will grow as tax returns submitted with extensions continue to be tallied. Remember, the official estimates anticipated that the credits would grow in popularity over time. If they do, even at the relatively modest rates projected, we’d get a mind boggling $17.2 billion dollars claimed in 2031, the final year of the credits.

Stacked up from 2023 until the credits expire in 2031, it would amount to $131.4 billion claimed, vs. the official estimate of $36.2 billion. That’s nearly half of the ENTIRE anticipated $270 billion expenditure across all 26 new or modified clean energy tax credits in the IRA, combined🤑!

Based on the limited data available, we’re seeing a similar trend across other IRA tax credits. Uptake of the new and used clean vehicle tax credits have outperformed expectations, with more than $1 billion claimed via point-of-sale rebates in the first 5 months of the year. And given that 10% of the new clean vehicle and 20% of used clean vehicle tax credits weren’t filed via point of sale, the amount ultimately claimed under those credits for the first 5 months of the year will be well above that $1 billion figure. If those trends persist through the end of the year, we could see as much as 5 times the originally estimated $547 million claimed in 2024. CBO also expected the uptake of these tax credits to increase until they expire in 2032. There are lots of reasons why that might not be the case, including the strict sourcing requirements that, among other things, disqualify new clean vehicles from the tax credits if certain critical minerals and battery components are sourced from China starting in 2025. Even so, the fact that these credits could hit $2.5 billion in claims this year alone is incredible; the official estimates never saw these credits surpassing more than $1.6 billion in any given year.

There was a lot of speculation that, given the sourcing requirements, the 30D new clean vehicle tax credits would be undermined by the 45W Commercial Clean Vehicle credit, which does not have sourcing criteria and can be applied to most conventional EV leases. So far, that has not happened, despite high anticipated uptake for 45W with preliminary data showing an 8% bump in EV leases vs sales since Treasury’s determination that leased vehicles can qualify. And speaking of those 30D sourcing requirements, DOE’s Office of Manufacturing and Energy Supply Chains (MESC) provided new Q&A to help explain how it will interpret the IRA’s Foreign Entity of Concern provision, most notably that OEMs need to take action now on sourcing FEOC-compliant graphite in order to qualify for the “impracticable-to-trace transition rule”.

New EV Retail Registrations by Finance Type

*Source: S&P Global:* *https://www.spglobal.com/mobility/en/research-analysis/the-growing-popularity-of-ev-leasing.html*

There’s also evidence of the IRA’s power to move markets in the growing clean energy tax transfer sector. A new Crux report projects deal volume to more than double from $9 billion in 2023 to $20-25 billion in 2024.

Actual and Forecast Quarterly Deal Volume in 2024 Tax Credits

*Source: Crux:* *https://www.cruxclimate.com/insights/highlights-from-mid-year-market-intelligence-report*

This is all corroborated by MIT and the Rhodium Group’s recent Clean Investment Monitor report on the impact of the IRA in its first two years. In addition to loads of great data about clean energy manufacturing investment by sector, it also included this really interesting table with its estimates of federal spending on the various IRA tax provisions, as well as government grants and loans. It’s worth noting that the CIM anticipates $9.14 billion to ultimately be spent for the Residential energy and efficiency tax credits in 2023 vs. Treasury’s initial $8.4 announcement.

*Source:* *Clean Investment Monitor: Tallying the Two-Year Impact of the Inflation Reduction Act*

Treasury wasn’t the only one celebrating the IRA’s birthday - 18 House Republicans (mostly in Democrat stronghold states) wrote to Speaker Johnson urging him not to repeal the law.

Government Financing: August’s Awards

The U.S. Government opened the spigots in August, announcing more than $34 billion in grants, loans, and loan conditional commitments. This more than tripled the massive $10 billion investment in July.

August’s Spotlight Deal ☀️ DOE Loan Programs Office (LPO) announces $1.45 billion conditional commitment for a loan to QCells to support its solar manufacturing facility in Georgia which will produce ingots, wafers, cells and finished solar panels. The facility will be the largest ingot and wafer plant ever built in the United States. It will also be the first fully integrated silicon-based solar manufacturing facility constructed in the United States in over a decade. Given the global dominance of Chinese companies in the solar manufacturing sector, the loan package to QCells, a subsidiary of South Korea-headquartered Hanwa, has important energy security and manufacturing onshoring ramifications.

🇺🇲+🇰🇷**LPO Facilitates Massive Korean Clean Tech Investment into U.S.**
The announcement is its latest in an impressive list of LPO deals with Korean-based firms. LPO’s financing of more than **$13 billion** to projects supported by these companies could unlock multiples more of foreign direct investment from Korea into the U.S. clean energy manufacturing sector and attract jobs, skills, and financing into sectors with few U.S. participants. LPO funding for Korean-backed projects amounts to nearly 44% of the more than $31 billion total in LPO conditional commitments and closed loans under the Biden Administration. Clean tech is clearly becoming a key pillar of the U.S.-Korea bilateral relationship.

🏦Environmental Protection Agency (EPA): $27 billion obligated in three Greenhouse Gas Reduction Fund Grants:

$14 billion National Clean Investment Fund (NCIF) selected three grant recipients to establish national clean financing institutions to fund clean tech projects:

$6.97 billion to the Climate United Fund
$5 billion to the Coalition for Green Capital
$2 billion to Power Forward Communities, a nonprofit coalition formed by Enterprise Community Partners, Rewiring America, Habitat for Humanity International, the Local Initiatives Support Corporation (LISC), and United Way Worldwide

$6 billion Clean Communities Investment Accelerator (CCIA) selected five grant recipients to establish hubs to provide funding and technical assistance to community lenders to deploy projects like distributed energy, net zero building, and zero emissions transportation projects:

$2.29 billion to the Opportunity Finance Network
$1.87 billion to Inclusiv
$940 million to the Justice Climate Fund
$500 million to Appalachian Community Capital
$400 million to the Native CDFI Network

$7 billion Solar for All program selected 60 grant recipients (state governments, nonprofits, Tribes and Tribal nonprofits, and municipalities) to create or expand low-income solar programs, enabling over 900,000 households to benefit from solar energy.

⚡DOE Grid Deployment Office (GDO): $2.2 billion first 8 selections for the second round of GRIP funding for Grid Innovation Program. Funding will support 8 projects across 18 states, catalyzing more than $8 billion in additional private investment:
- $600,561,319: California Energy Commission: Charge 2T: California Harnessing Advanced Reliable Grid Enhancing Technologies for Transmission.
- $389,345,755: Massachusetts Department of Energy Resources: Power Up New England Transmission and Storage project in Massachusetts, Connecticut, Maine, Rhode Island, New Hampshire, and Vermont
- $700,000,000: Montana Department of Commerce: North Plains Interregional Innovation Transmission project in Montana and North Dakota
- $30,000,000: New York Power Authority: Clean Path New York underground/underwater HVDC transmission line in New York
- $57,099,386: North Carolina Department of Environmental Quality State Energy Office: North Carolina Innovative Transmission Rebuild project, in partnership with Duke Energy
- $87,629,455: Redwood Coast Energy Authority: Tribal Energy Resilience and Sovereignty Project will develop Tribe owned and operated microgrids in partnership with four Tribes in California
- $249,557,047: Utah Office of Energy Development: Reliable Electric Lines: Infrastructure Expansion Framework Project to deploy advanced conductor cables to boost transmission capacity across Utah, Oregon, Wyoming, Idaho, Arizona, California, and five tribal nations.
- $85,433,351: Virginia Department of Energy: Data Center Flexibility as a Grid Enhancing Technology project in Virginia and South Carolina.
☢️DOE LPO: $1.5 billion closed loan with Holtec for restoration of Palisades Nuclear Power Plant in Michigan

🏭DOE Office of Clean Energy Demonstrations (OCED): $500 million in total federal cost share, $300,000 awarded in phase 1, for Heidelberg Materials for decarbonized cement production in Indiana.
✈️Federal Aviation Administration (FAA): $291 million for sustainable aviation fuels and technologies to 36 projects. Major selected recipients include:

$50 million to Martinez Renewables (50/50 JV between Marathon and Nestle) for SAF production
$26.7 million to BP for SAF production at the Cherry Point refinery.
$24 million to Buckeye Terminals for SAF storage and distribution terminals
$22.9 million to Phillips 66 for SAF blending, production, and storage operations.
$21.9 million to World Energy for SAF pipeline and transportation.
$18.3 million to CITGO Holdings for a SAF blending and distribution hub
$16.8 million to Gevo, Inc to convert a Minnesota fuel facility to SAF production.
$8 million to JetZero to develop enabling technologies for a fuel efficient airplane
$5.6 million to Green Taxi for electric airplanes.

🏭OCED: $270 million in total federal cost share, $8.6 million awarded in phase 1 to Sutter CUS, a subsidiary of Calpine, to demonstrate and deploy a CCUS facility on a natural gas combined-cycle power plant.
🏫DOE: $190 million for energy upgrades that will decrease energy use and costs at 320 K-12 schools across 25 states
⚡DOE OCED: $141.95 million to 13 projects for energy improvements in rural areas:

$32 million in federal cost share, $610,302 in phase 1, for Yakama Power to install solar PV and micro hydropower.
$26.9 million in federal cost share, $3.4 million in phase 1, to Kootznoowoo for the Thayer Creek Hydroelectric Project in Alaska.
$26.06 million in federal cost share, $4.1 million awarded in phase 1, to the Alaskan Tribal Energy Sovereignty project to deploy solar PV and battery storage into existing microgrids currently relying on diesel.
$14.1 million in total federal cost share, $635,881 in phase 1, to the Bad River Band of Lake Superior Tribe Chippewa Indians to deploy solar PV and BESS in Wisconsin.
$10 million of federal cost share, $1.5 million in phase 1, to the Alutiiq Tribe to deploy a hydroelectric facility in Alaska.
$8 million in total federal cost share, $400,000 in phase 1 to Native Renewables Inc to electrify tribal homes by installing solar PV and BESS at the Navajo Nation and Hopi Tribe.
$5 million to the Choctaw Nation of Oklahoma to deploy 2.1 MWh of battery energy storage systems (BESS)
$5 million to the Kokhanok Village Council to install BESS, solar PV, and a wind turbine to a microgrid in Spruce Island, Alaska.
$5 million to the Tanana Chiefs Conference to incorporate 1.5 MW of solar PV and 1.5 MWh of BESS on the local grid in Alaska.
$5 million to the Adams Electric Cooperative to install wind and solar power in Illinois.
$5 million in federal funding to Navajo Power Home to install solar PV and BESS on off-grid homes across the Navajo Nation.
$2.6 million in federal funding to Navajo Transitional Energy Company to install solar PV and BESS on off-grid Navajo Nation homes.
$2.3 million to the Native Village of Ouzinkie to deploy BESS and solar PV in a microgrid in Alaska.

⚡U.S. Department of Agriculture (USDA): $140 million for rural clean energy projects in Nevada and Kentucky as part of the Powering Affordable Clean Energy (PACE) program, funded through the IRA:

$80.3 million to Valley Electric Association to install a solar power generation and BESS facility in Nevada.
$19.3 million to Lock 9 Hydro Partners to build a run-of-river hydroelectric plant in Kentucky.
$18.9 million to Lock 10 Hydro Partners to build a run-of -river hydroelectric plant in Kentucky.
$6.6 million to Bluestem Energy Solutions to build a solar power facility in Kentucky.

🌽USDA: $90.3 million in Higher Blends Infrastructure Incentive Program grants to 89 projects in 26 states to install and upgrade infrastructure to expand the sales of renewable fuels.
🏭DOE MESC: 4 projects for negotiation of $84.7 million in funding for heat pump manufacturing:

$25 million: A.O. Smith for increased production of heat pump water heaters in Tennessee
$39 million: Daikin for expanding its facility in Texas for air-to-air heat pump production and introducing air-to-water heat pump systems to the U.S. market
$15.7 million: Modine for accelerating domestic manufacturing of industrial high-efficiency electric heat pumps at its Texas and Rhode Island facilities
$5 million: Bitzer Scroll for producing electric heat pump compressors in New York

🏭DOE OCED: $75 million in total federal cost share, $19 million in phase 1, to Cleveland-Cliffs for decarbonized steel production in Pennsylvania.
🏭DOE OCED: $75 million in total federal cost share, $4.1 million in phase 1, to Constellium for the Low Carbon SmartMelt Furnace Conversion project to deploy a first-of-a-kind zero carbon aluminum casting center in West Virginia.
Ⓗ DOE EERE: $62 million for 20 projects across 15 states to accelerate the research, development, demonstration, and deployment of next-generation clean hydrogen technologies.
🏭DOE OCED: $49 million in total federal cost share, $5 million in phase 1, to TDA Research in collaboration with Schlumberger to deploy a pilot carbon capture system at the Dry Fork Power Station in Wyoming.
☁️DOE Fossil Energy & Carbon Management (FECM): $44 million to nine university and industry-led projects to provide technical assistance in geologic basins targeted for carbon storage.
🌡️DOE Office of Energy Efficiency and Renewable Energy (EERE): $31 million for six projects to advance innovative geothermal energy technologies. Selected project participants are Clemson University, Innovative Downhole Solutions, Schlumberger Technology Corporation, Project Development Solutions, Los Alamos National Laboratory, and Lawrence Berkley National Laboratory.
☀️USDA: $30 million PACE grant to SE Municipal Solar to build solar PV generation facilities in Nebraska.
🪨DOE FECM: $10.2 million for four projects that will produce and refine critical minerals and materials. $2.7 million went to three projects led by labs and universities in Idaho, Iowa, and Pennsylvania, while $7.3 million was awarded to Aspen Aerogels to develop fast charging LFP Aerogel Cathode Materials to eliminate Nickel/Cobalt reliance in Massachusetts.
🪨DOE Advanced Research Projects Agency-Energy (ARPA-E): $9.9 million for 7 projects to develop a low carbon, cost competitive, domestic supply chain for nickel. Awardees are Verinomics, Advanced Environmental Technologies, and Universities in Michigan, Wisconsin, Arizona, Florida, and Massachusetts.
⚡USDA: $9.2 million in Rural Energy for America Program grants to 71 projects in Minnesota to help farmers and small business owners expand their use of wind, solar, and make energy efficiency improvements.
Ⓗ DOE FECM: $8.8 million in 11 university R&D Projects to improve hydrogen turbine performance
💨DOE EERE: $5.3 million for three projects for advanced manufacturing in the offshore wind sector. Selected participants are Siemens Corporation, TPI Composites, and the National Renewable Energy Laboratory.
⭐DOE Office of Science: $4.6 million to 17 U.S. businesses to accelerate fusion energy development. The full list of selected awards can be found here.

Government Financing: August’s Opportunities

The Federal Government announced more than $1.6 billion in new funding opportunities in August across several clean tech sectors.

🛣️Federal Highway Administration: $800 million in grant funding for the use of low carbon construction materials. The program will reimburse the higher costs of using low carbon materials. Applications are due November 25.
☀️🔋DOE GDO: $325 million for solar and battery storage for community healthcare facilities and multi-family housing in Puerto Rico. Applications are due October 22.
☁️DOE FECM: $127.5 million for carbon dioxide capture, removal, and conversion test centers for cement manufacturing facilities and power plants. Submission deadline for full applications is October 31.
🔋♻️DOE MESC: $63 million to advance battery recycling and smart manufacturing. Funding is geared towards state and local governments to support modernization of the manufacturing sector and increase battery recycling. Concept papers are not required and full applications are due Monday, September 16 by 5:00PM ET.
🏭DOE FECM: $54.4 million to develop technologies that capture CO2 from industrial and power generation sources or directly from the atmosphere and transport it to permanent geologic storage or conversion into valuable products. Full applications due October 14.
☁️DOE FECM: $52.2 million for the Commercial Direct Air Capture Pilot Prize to support technology developers that design, build, commission, and operate innovative DAC pilot facilities capable of capturing at least 500 tonnes of atmospheric Co2 per year. Applications are due November 15, 2024.
🚗DOE MESC announced $50 million for Michigan, Ohio, Indiana, Kentucky, Tennessee, and Illinois to help small- and medium-sized auto industry suppliers adapt manufacturing facilities for the electric vehicle (EV) supply chain. The states have until October 15 to apply.
🔋DOE EERE: $43 million for advanced battery RDD&D. Concept papers due September 9.
💨DOE EERE: $48 million for Offshore Wind National and Regional R&D. Concept papers due September 3.
🪵USDA: $25 million for Hazardous Fuels Transportation Assistance Grants to support projects that remove hazardous fuels from national forests to locations where they can be used for products and services. Applications are due September 5.
🏭DOE OCED: $15 million lab call to accelerate industrial decarbonization in chemicals & refining, concrete and cement, and metals sectors. DOE will host an informational webinar on September 4.
🏭DOE Office of Technology Transitions (OTT): $15 million lab call to address adoption challenges preventing commercialization and deployment of industrial decarb technologies.
⚡DOE EERE: $11.2 million to distribution utilities to pilot innovative solutions for managing renewable energy interconnection and EV charging energization queues. Learn more at office hours on September 19 and apply by October 16.
🌊💨DOE EERE/National Offshore Research and Development Consortium: $10.6 million to drive innovation in floating offshore wind technology. Informational Webinar on September 10. Proposal submissions due November 14.
👷DOE EERE: $3.3 million for Good Jobs in Clean Energy Prize
🪵DOE EERE: $2 million CRADA for next generation clean wood heaters. Concept papers due September 13.
⚡DOE Office of Environmental Management (EM) issued a request for qualifications related to siting utility-scale energy projects within the 310-square mile Savannah River Site. Proposals are due by October 4.
🧑‍🏫DOE EERE: Apply by September 22 to the Building’s Technology Office’s 2025 IMPEL cohort. IMPEL equips innovators with the support they need to bring their ideas to market, including pitch training, networking opportunities, and insights from mentors.
💼DOE Voucher Program is open for submissions through September 12 for in-kind commercialization support for small businesses and nontraditional partners.
🔋U.S. Army released its SBIR/STTR open topics, including one on Batteries (closes October 15) and one on hybrid electric powertrain, power, and propulsion systems (closes September 17).

Engage in the Debate

Treasury issued a Notice of Proposed Rulemaking for the IRA’s 48E(h) Clean Electricity Low-Income Communities Bonus Credit Program. Comments due October 3.
Why it matters: The allocated credit (1.8 GW available annually) provides a 10 or 20 percentage point bonus in addition to the 30% 48E Clean Electricity Investment Tax Credit if prevailing wage and apprenticeship requirements are also met. Under the proposed rule, additional types of clean electricity would be eligible for the credit, including geothermal, nuclear, and hydroelectric, among others.

DOE EERE: Request for Information (RFI) on Enhancing Coordination of the Lab Embedded Entrepreneurship Program
U.S. General Services Administration: RFI on enabling energy efficiency and decarbonization in commercial buildings. Submissions due September 13.
DOD Defense Advanced Research Projects Agency (DARPA): RFI and suggestions on fundamental breakthroughs required for High Power Direct Energy Conversion from Nuclear Power Systems.
DOE EERE: RFI on energy efficiency for semiconductor applications. Responses due September 30.
DOE EERE: RFI to inform West Coast Offshore Wind Transmission Action Plan. Responses due October 3.
DOE EERE: RFI for further innovation of cleaner and more efficient wood stoves and the best use of renewable wood feedstocks. Responses due September 6.

Upcoming Events

September 4: DOE OTT webinar for industrial decarbonization lab call. Register here.

September 5: DOE OTT webinar: How Rising Electricity Demand Can Support Liftoff of Clean Energy Solutions. Register here
September 12: DOE Bioenergy Technologies Office will host its 2024 Agile BioFoundry Industry Day to discuss their capabilities and potential opportunities for joint research efforts. Register here
December 3-6: DOD Energy and Environment Innovation Symposium
December 4-5: Deploy24