In April, 2023, the Biden-Harris administration in the U.S. announced that it has directed $14 billion in federal investments to fund the development of clean energy initiatives.
Part of President Biden’s Investing in America Agenda, these funds were earmarked to drive new investments in “energy communities,” strengthen green supply chains, and allow coal, oil, and gas workers to benefit from newer innovations in green technology.
To understand how this federal investment will impact various stakeholders, we need to first establish what constitutes an “energy community.” It could include the following:
- Brownfield sites, or large pieces of underutilized land that have been contaminated by hazardous waste or pollutants.
- Areas that generate significant employment in the coal, oil, and natural gas sectors.
- An area where a coal mine has been shuttered since 2000 or a coal-fired generating unit has been retired since 2010.
As part of this latest federal fund, developers of clean energy products stand to gain billions in bonuses if they establish new projects within an energy community.
These bonuses are in addition to other financial incentives for clean energy manufacturers—such as investment and production tax credits—that were outlined in 2022’s Inflation Reduction Act.
Let’s closely examine some of the impact this has had on green technology innovation.
How the Costs of Renewable Energy Dropped Over Time
The measures announced by the White House stand to bring the cost of manufacturing renewable energy to an all time low. In fact, the Guardian reports that it is already more expensive to keep a coal-fired power plant running than it is to build a brand new renewable energy operation for green technology.
The study quoted clarifies that renewable energy costs are falling to such an extent following the Inflation Reduction Act that it may soon be “cheaper to build an array of solar panels or a cluster of new wind turbines and connect them to a grid” than it is to operate 99% of the coal plants in the U.S..
Furthermore, in 2022, electricity generated from renewable sources surpassed both coal-fired and nuclear power for the first time in history.
As the demand for coal-fired energy continues to drop, 173 coal plants in 33 states are expected to close by 2030, according to the nonpartisan Institute for Energy Economics and Finance Analysis (IEEFA). This has led to concerns over the livelihood of employees in this field.
What Happens to Coal Miners?
While this latest investment is excellent news for organizations working toward developing green technology, not everyone stands to benefit from the sudden rise in ESG projects.
Supporters of mining see this as an attack on coal, which they believe has been a highly reliable source of fuel during times of instability.
Rich Nolan, the president of the National Mining Association, claims that the government is forcing the essential coal capacity off the grid without offering reliable alternatives or the necessary infrastructure to support these alternatives. The new investment fund will only deepen reliability and economic challenges, he was quoted as saying in the Guardian.
However, the White House points out that this $14 billion federal investment initiative is meant to encourage the growth of clean energy facilities. It should also spur job creation in areas affected by the shutting down of mining opportunities.
The Biden government says the series of measures will “ensure coal, oil, and gas workers benefit from the new clean energy economy.”
“Deploying clean energy projects on America’s mine lands will unlock new opportunities for energy communities that have helped power our nation for generations, especially those in rural areas that have been the most affected by the energy transition,” said U.S. Secretary of Energy, Jennifer M. Granholm.
Building on the $14 billion investment, the Department of Energy has also pledged $450 million under the Bipartisan Infrastructure Law for clean energy projects that operate on current and former mine lands.
In 2023, there are around 17,750 mine lands across the country, spanning over 1.5 million acres. When these areas are repurposed and used to create clean energy, the United States Environmental Protection Agency estimates that nearly 30 million American homes can run on renewable sources in the near future.
Companies are already taking advantage of this and many have been working in tandem with engineering consulting services to invest billions into developing clean energy manufacturing, steel production, and critical minerals processing.
Now Wanted: Green Technology Engineering Services
With this massive transformation underway, the country will be relying heavily on the expertise of engineering services to recommend the best possible courses of action. ESG engineering that expertly implements green technology will be critical in helping the country give a fillip to the hardest-hit energy communities nationwide.
The Office of Clean Energy Demonstrations, which manages the program to transform mine lands across the country, has announced its support. The department will provide up to 50 per cent of the cost for well-designed, financially viable clean energy projects that can be deployed quickly and work towards building local infrastructure.
Projects of this nature will also require the expertise of multi-discipline engineering consultants, who believe in the goal of a carbon-neutral future.
Conclusion
The latest $14 billion investment in clean energy is just one example of the country’s shift away from reliance on fossil fuels. At the same time, it shows that this progression cannot occur without acknowledging the sacrifices that coal, oil, and natural gas employees have made along the way.
The main goals of this federal investment fund are to empower existing projects with green technology, counter the loss of livelihood that comes with the shutting down of coal mines, and urge companies to innovate with clean energy sources.
The support and expertise of engineering consulting services are critical in this time of transition.
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