In November 2021, “[t]he U.S. House of Representatives passed the Infrastructure Investment and Jobs Act, a bipartisan infrastructure bill that will create millions of jobs, turn the climate crisis into an opportunity, and put us on a path to winning the competition economy for the 21st century. The White House briefing room, Statement by President Joe Biden on the House passing the bipartisan Infrastructure Investment and Jobs Act (Nov 6, 2021). The Infrastructure Investment and Jobs Act, also known as the Bipartisan Infrastructure Bill (“Infrastructure Bill”), allocates $550 billion to projects across the country, ranging from new stormwater management projects to ensuring universal high-speed Internet access. Pub. L. no. 117-58 (2021). Of particular interest will be the distribution of more than $62 billion allocated directly to the Department of Energy (“DOE”). The bill directs investments to specific areas, many of which aim to facilitate the energy transition in pursuit of the Biden administration’s commitment to combat climate change.
CARBON CAPTURE, USE, STORAGE AND TRANSPORT
The infrastructure bill allocates more than $10 billion to fund research on carbon capture, direct air capture, carbon utilization and industrial emissions reductions. DOE Fact Sheet, above; see also Infrastructure Bill, § 40301-04 (describing programs). Significantly, the Carbon Dioxide Transportation Infrastructure Finance and Innovation Program will provide eligible projects with either federal credit instruments or a grant. Priority will be given to projects that: (a) consist of high capacity public transport infrastructure; (b) have demonstrated a demand for use of the infrastructure by associated projects that capture carbon dioxide from anthropogenic sources or ambient air; (c) enable geographic diversity in associated projects that capture carbon dioxide from anthropogenic sources or ambient air, with the goal of supporting projects in all major carbon dioxide-emitting regions of the United States ; and (d) are located within or adjacent to an existing pipeline or other linear infrastructure corridors, in a manner that minimizes environmental disturbance and other location issues.
The bill also allocates $3.5 billion to four regional direct air capture centers, which must have the capacity to sequester and use at least 1 million tonnes of carbon dioxide per year. The bill allocates an additional $2.5 billion to validate and test the large-scale commercialization of carbon dioxide storage. The bill also earmarks $3.47 billion to find large-scale pilot projects in carbon capture. King & Spalding previously wrote about these programs before the infrastructure bill was passed. See Customer Alert, Bipartisan Senate Infrastructure Bill Promotes Carbon Capture, Utilization and Sequestration (August 27, 2021).
As part of the infrastructure bill, the DOE will distribute $8 billion to support the development of clean hydrogen centers across the country. This will promote the production, processing, delivery, storage and end use of clean hydrogen. DOE Fact Sheet, above; see also Infrastructure Bill, §§ 40313, 40314. Notably, Congress directed the DOE to act quickly and solicit proposals for these hubs within 180 days of the bill’s passage, which is May 14. May 2022. Infrastructure Bill, § 40313.
The infrastructure bill also earmarks $1 billion for the Clean Hydrogen Electrolysis Program, which aims to support the demonstration, commercialization and deployment of electrolyser systems to reduce the cost of production. clean hydrogen from electrolyzers. Infrastructure Bill, § 40314.
The infrastructure bill also earmarks $700 million to upgrade hydrogen facilities with the goal of improving dam safety, increasing efficiency, reducing environmental impacts and maintaining generators that produce electricity without emissions. DOE Fact Sheet, above.
ELECTRIC VEHICLES (EVS)
The infrastructure bill earmarks $7.5 billion to build electric charging stations for electric vehicles. Infrastructure Bill, §§ 11101(b)(1)(C), 11401. New charging stations will support President Biden’s goal of having all new car sales go to vehicles by 2030 with a national network of 500,000 electric vehicle chargers. The DOE will administer these funds with the Department of Transportation.
NETWORK INFRASTRUCTURE AND RESILIENCE
The infrastructure bill directs the DOE to distribute $11 billion to states, tribes and utilities to improve the resilience of electrical infrastructure to extreme weather and cybersecurity issues. Identifier.
The infrastructure bill directs the DOE to allocate $2.5 billion for a transportation facilitation program to develop new national clean energy transmission lines. Identifier.; see also Infrastructure Bill, § 40106(d)(2) (describing transmission program objectives).
The infrastructure bill allocates $3 billion to expand the smart grid investment matching grant program, which will focus on flexibility in power transmission and distribution. Infrastructure Bill, § 40107(b) (discussing program implementation).
The infrastructure bill allocates $3 billion to develop a new battery materials processing grant program to be administered by the DOE’s Office of Fossil Energy and Carbon Management. Infrastructure Bill, § 40207(b)(4). This program will aim to support the construction of new facilities and demonstrations for the treatment of batteries.
Similarly, the infrastructure bill allocates $3 billion to the DOE’s Office of Energy Efficiency and Renewable Energy for battery manufacturing and recycling grants, which will help with battery manufacturing and recycling. . Infrastructure Bill, § 40207(c)(4).
The infrastructure bill also earmarks $140 million for the development of a demonstration facility and a rare earths refinery. Infrastructure Bill, § 40207(e). Managed by the DOE, this facility will help develop lithium-ion batteries for electric vehicles, ensuring U.S. manufacturers have direct access to these materials.
The infrastructure bill designates $6 billion to be distributed to the civilian nuclear credit program, with the goal of preventing the retirement of zero-carbon nuclear power plants. Infrastructure Bill, § 40323(i); DOE Fact Sheet: Bipartisan Infrastructure Agreement Will Benefit Workers, Families, and Bringing Clean Energy to the United States (November 9, 2021).
The infrastructure bill also earmarks $2.5 billion for the DOE’s Advanced Reactor Demonstration Program, which encourages research and development in advanced nuclear reactor technologies. Infrastructure Bill, § 41002(a).
These provisions indicate that the Biden administration may consider advanced nuclear as a viable form of clean energy.
For all of these programs under the Infrastructure Bill, the DOE and other federal implementing agencies will most likely issue guidelines or regulations providing more details on how companies can apply and apply. qualify for funding opportunities. In doing so, federal agencies may seek public comment, so interested stakeholders should monitor ongoing implementation efforts and take every opportunity to provide feedback to regulatory agencies.
As to how these programs will be administered, it is reasonable to expect that the DOE (and other agencies) will seek guidance on the Title XVII Loan Guarantee Program which covers a wide range of clean and renewable energy projects. See 42 U.S.C. §§ 16511, and following. Prior to the passage of the infrastructure bill, this multi-billion dollar program represented the federal government’s largest financial investment in commercializing clean, renewable energy projects.
Nikesh Jindal was at the DOE when the loan guarantee program was created and wrote the initial implementation guidelines. In response to the renewed emphasis on the loan guarantee program under the current administration, Nikesh and other colleagues at King & Spalding advised clients on how to navigate the process, including preparing applications, engaging third-party stakeholders to support projects, obtain permits and defend against any legal challenges to such permits, help structure project financing, and other related efforts to ensure the success of obtaining federal funding .
Marcella Burke served with the Environmental Protection Agency (EPA) as Assistant General Counsel. She also served in the Department of the Interior (DOI) as Deputy Attorney for Energy and Natural Resources and Senior Advisor to the Deputy Secretary for Lands and Minerals Management. In her roles at DOI, Marcella managed litigation and rulemaking, including for carbon capture programs, on federal lands.
As the DOE and other federal agencies begin implementing the Infrastructure Bill funding programs, King & Spalding will use this collective experience and expertise to help clients take advantage of important funding opportunities.