The US Department of Energy (DOE) has announced USD6bn in federal funding to subsidize 33 industrial projects in 20 states to help reduce their carbon emissions, as reported by Reuters on March 25. The initiative marks the largest-ever US investment in industrial decarbonization and could unleash a total of USD20bn in capital, including the costs companies need to share. The scheme focuses on projects in hard-to-abate sectors including chemicals, steel, food, refining, and cement, expected to eliminate more than 14 million tons of carbon dioxide (CO2) emissions in total. For instance, as much as USD500m will be allocated for Cleveland-Cliffs Steel’s [CLF:US] factory in Middletown, Ohio. The plant will install two new electric arc furnaces and hydrogen-based technology to reduce 1 million tons of greenhouse gas emissions.

DOE Minister Jennifer Granholm stated that the investment will significantly bring down emissions from these hard-to-abate industries and ensure American workers and businesses are at an advantage in the global market. This initiative, introduced by the DOE last year, provides up to 50% of the cost for first-of-a-kind or early-stage decarbonization projects. The DOE anticipates the selected projects to achieve an emission reduction of 77% on average. Notably, the substantial federal funding was made possible by the Bipartisan Infrastructure Law and the Inflation Reduction Act (IRA), which provide nearly USD500m and over USD5.5bn for the initiative, respectively.

Sources:

https://www.reuters.com/sustainability/sustainable-finance-reporting/us-awards-record-6-bln-back-industrial-emissions-reduction-projects-2024-03-25/

https://www.bloomberg.com/news/articles/2024-03-25/us-announces-6-billion-to-clean-up-heavy-manufacturing

https://www.esgtoday.com/biden-administration-invests-6-billion-in-industrial-decarbonization-projects/