The energy needed to heat, cool, and power American homes accounts for about one-fifth of the total greenhouse gas emissions produced by the United States each year. Even as the country transitions to renewable energy and buildings become more efficient, the housing sector is not changing fast enough to meet the country’s climate goals. At the same time, a growing number of Americans — about 20 million people as of 2022 — are falling behind on their utility bills.
On Thursday, the Department of Energy took aim at both issues, announcing the Biden administration’s goal of cutting the cost of home decarbonization in half and cutting home energy costs by at least 20 percent by the end of the decade.
“Every American deserves to live in a home with clean, reliable, affordable energy,” Energy Secretary Jennifer Granholm said in prepared remarks for the announcement. She said that saving energy “means real money back in the pockets of hard-working Americans.”
Efforts will focus on incentivizing cheaper ways to rehabilitate families earning less than 80 percent of the median income in their area. Granholm highlighted low-cost approaches such as installing simple, compact heat pumps and insulated panels for exterior walls.
The new goals are part of the Biden administration’s broader Justice 40 initiative, which aims to direct 40 percent of the benefits of federal climate action to low-income and minority communities. But the hope is that any solutions will be applicable elsewhere as well.
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“We want to look at technologies that can start in affordable housing and move into the larger built environment,” said Ram Narayanamurthy, deputy director of DOE’s Office of Building Technologies. “We know we have to reduce costs and make energy affordable for everyone.”
The push announced today, called the “Affordable Home Energy Shot,” is the eighth and final pillar of the agency’s “Energy Earthshot” initiative, the goal of which is to accelerate the Biden administration’s bid to cut the nation’s emissions nearly in half by 2030. The first identified these The initiatives, a “hydrogen injection” announced in the summer of 2021, aim to reduce the price of clean hydrogen fuel by 80 percent by 2030. Other “steps” include reducing the cost of floating offshore wind technology, geothermal energy, and carbon dioxide removal technology from Atmosphere.
“The Affordable Energy Earth Shot is a great example of the federal government stepping in to fill a real gap in the market,” said Sarah Baldwin, director of electrification at Energy Innovation Policy & Technology, a nonprofit energy and climate research organization. She pointed to the success of the SunShot initiative launched by the Department of Energy in 2011 to reduce the cost of utility-scale solar energy to $1 per watt within a decade. Prices reached this level in 2017, about three years ahead of schedule.
Funding for the latest effort flows from the bipartisan Infrastructure Act passed in 2021 and the Inflation Reduction Act of 2022. The two sweeping bills provided $13.5 billion for DOE housing programs.
On Thursday, the Biden administration also announced $30 million in clean energy funding from the infrastructure bill for 27 states, counties and cities, as well as the MOWA Band of Choctaw Indians in Alabama. The grants, awarded to primarily assist low-income and minority communities, will be distributed by states and local governments to fund rural electrification projects, build electric vehicle charging stations, and power hospitals, among other local initiatives.
The Department of Energy acknowledges that ensuring Justice40 communities get their share of the R&D benefits from the latest energy shot will be more difficult than simply tracking grant money. Many of those same communities have already criticized the administration for failing to define exactly what this “benefit” is and for keeping what amounts to an overly broad sense of where the money goes.
“Not every project is going to be something that directly serves the community,” said Michael Reiner, a policy analyst in DOE’s Office of Economic Impact and Diversity. “But you want to know that what you’re investing in is making progress toward something that will make that happen.”
The Department is also still in the process of establishing criteria and processes to evaluate progress in achieving Earthshot’s recent overall reduction goals. But officials say the first step is ensuring everyone is working toward the same goal.
“It’s really about driving innovation forward using new materials (and) new technology in a way that can lower the cost of what is currently needed to decarbonize homes,” said Jennifer Arrigo, director of the department’s Science and Energy Division. “Energy shots are meant to provide a North Star.”
