Evergreen’s new report, Defending the Climate: Using the Defense Production Act to Mobilize American Clean Energy Manufacturing, breaks new ground by laying out how President Biden can use the DPA to advance the clean energy transition. The DPA complements and builds upon the policies his administration has already set into place—in fact, the president has already started to tap into some of its provisions. 

In June 2022, he issued several directives under the DPA, recognizing shortages in five critical clean energy technologies. He established that these shortages were a threat to national defense, which enabled the Department of Energy (DOE) to support much-needed domestic manufacturing capacity using DPA authorities. This empowered DOE to make subsidy payments, purchase and install manufacturing equipment in private and government facilities, and make loans and capital grants to manufacturers. 

But the DPA offers a powerful, yet rarely used suite of tools beyond these directives, and President Biden can fully capitalize on the full potential within this decades-old law.  

What’s the Defense Production Act? How can it be leveraged for climate?

The DPA was established in 1950 during the Korean War to allow the president to maintain the domestic industrial base for national defense needs. It affords the president a wide range of authorities to strengthen supply chains, support US-based manufacturers, and secure access to critical equipment and materials. Presidents from Harry Truman to Barack Obama to Donald Trump, and now Joe Biden have used the DPA to respond to natural disasters, energy shortages, the COVID-19 pandemic, and more. 

The DPA was originally designed to empower the president against threats to national defense—and we are under threat now, as climate change represents the single greatest challenge of our generation. Aptly acknowledged by then-National Economic Council Director Brian Deese, “climate change cannot be addressed by market forces alone.” A successful strategy hinges upon mobilizing the private and public investments necessary to achieve our core economic and national security interests. 

During World War II, we needed to rapidly produce equipment for tanks, planes, and other war supplies and required a sea change in the national industrial base to meet that urgency. Now, to address the climate crisis and hit our science-based climate targets, annual U.S. solar deployment will likely need to double every year throughout the 2020s. President Biden’s ambitious offshore wind energy target will require the installation of up to 2,000 turbines by 2030; as of 2021, U.S. waters were home to only seven turbines. Fully decarbonizing the buildings sector will mean electrifying the 49.1 million American households and millions of commercial kitchens that currently use fossil fuel equipment for cooking. 

By invoking the full powers of the DPA, the U.S. can build the factories and strengthen the supply chains needed for the clean energy transition and take ownership of American clean energy independence—all while centering equity, labor rights, and justice.

Two ways the DPA could be put to work 

Evergreen’s report breaks new ground by laying out 15 distinct use cases for the DPA under four broad authorities. Most of these authorities are rarely used, and none have been applied in a clean energy context. Among this exciting slew of possibilities, two applications stand out: facilitating disaster recovery and coordinating place-based clean energy investments. 

1. Facilitating disaster recovery

Climate change is driving an unprecedented surge in extreme weather events and disasters that are anything but “natural.” As we face an increasingly severe, costly, and frequent number of droughts, wildfires, and hurricanes across the country, we need faster responses to support communities and must seize the opportunity to rebuild with cleaner, more efficient technology. 

These climate-fueled disasters regularly damage critical infrastructure, taking power lines and other services offline indefinitely. Moreover, supply chain crunches make immediate repairs far more expensive, and often altogether impossible. After major storms, materials shortages can lead to rationing and extensive delays in repairs and reconstruction. Distribution power transformers (DPTs), for example, are essential for restoring service in the aftermath of a natural disaster—but supply chain bottlenecks have led to a four-times increase in wait times for DPTs. 

In the face of these and similar challenges, the use of priority purchasing under Title I of the DPA can help resolve these kinds of supply chain crunches by expediting procurement, while allocations under the DPA would help ensure the availability of such supplies. The DPA empowers the Federal Emergency Management Administration (FEMA) and the Department of Energy (DOE) to establish priority contracts between key suppliers and utilities, contractors, and local government agencies in charge of rebuilding, so critical services can come back online as quickly as possible. 

Priority contracts, and responding to these kinds of disasters more broadly, can be used as an opportunity to rebuild with clean, modern, resilient technologies and update our grid. When rebuilding, FEMA or DOE could open contracts with suppliers of grid-enhancing technologies (GETs). In a time when we need to rapidly upgrade transmission infrastructure, GETs more efficiently conduct electricity at a low cost. A perverse incentive structure discourages utilities from deploying them, but strategic use of the DPA in disaster contexts could rightly tip the scales in their favor. 

Lastly, we’ve seen low-income communities and communities of color repeatedly left behind in disaster relief, and years later they often continue to struggle without functioning infrastructure. A just implementation of the disaster relief efforts under the DPA that prioritizes relief for the hardest-hit communities is an opportunity to right this historical wrong and advance environmental justice. 

2. Targeting place-based investments

President Biden has made place-based investments a cornerstone of his green industrial strategy, targeting federal funding to regional economies across the country. Place-based industrial strategies are an effective tool for boosting clean tech production and deployment and can ensure that disinvested communities are benefiting directly from climate action. Establishing “regional clean energy industrial clusters” is a best practice recommended by DOE to develop a strong domestic clean energy manufacturing base—and it’s already being put to work in the private sector. In Georgia, one company is building a complete solar supply chain, comprising three plants. A “Battery Belt”, spanning eight states, is emerging across the Midwest and the South. Federal investments in “hydrogen hubs” will create industrial clusters of companies producing and consuming hydrogen fuels. Place-based investments are among the most exciting developments of the Biden industrial strategy, and one key DPA provision can help them grow.

Voluntary agreements (VAs) under Title VII of the DPA allow the president to convene representatives of industry, organized labor, and environmental justice communities to coordinate and maximize the growth of domestic clean tech manufacturing. By supporting coordination among federal agencies and a broad array of stakeholders, VAs offer a forum to develop and execute regional investment strategies.

We saw a similar application of the DPA in 2020 when, at the height of the COVID-19 pandemic, the Trump administration convened medical equipment manufacturers under a VA. That agreement sought in part to coordinate the regional manufacturing and distribution of medical equipment. A VA for clean technology industries could act similarly to strengthen domestic manufacturing through regional investment strategies.

These examples are just the tip of the iceberg. Evergreen’s latest report lays out more than a dozen other applications of the DPA that can be used both in the near- and long-term. Our analysis also digs into the implications of President Biden’s green industrial strategy for workers and environmental justice communities and lays out key steps to ensure an equitable and fair clean energy transition.

Prioritizing environmental justice and workers’ rights in America’s industrial strategy

As the DPA reinvigorates American industry, it’s essential that optimizing for output does not come at the expense of workers’ interests and that environmental justice is at the heart of our industrial strategy. Low-income communities and communities of color have long borne the costs of industrial growth with polluting manufacturing facilities and extraction sites being disproportionately located in their backyards. In implementing the many benefits the DPA offers, the Biden administration must ensure DPA-supported projects stand to benefit frontline communities and support working families through high-road labor practices. 

This is our moment to continue the momentum President Biden has created and build and execute an industrial strategy that will reap dividends now and for generations to come. While the clean energy transition presents a historic challenge, it also offers tremendous opportunity. President Biden can seize the full potential of the DPA fully to advance industrial policy that is just and equitable and catapults us toward our clean energy future.