An Electrifying Year for Federal Decarbonization Policies

Part of NRDC’s Year-End Series Reviewing 2022 Climate & Clean Energy Developments

With progress on a variety of federal policies for building decarbonization, there are many accomplishments to reflect on this year. And gratitude is like gravy – put that stuff on everything! – so here are some of the many things worth celebrating from 2022 . . .

The Federal Decarbonization Policy Community: With over $2 trillion of new federal spending between the Investing in Infrastructure and Jobs Act (IIJA), the Inflation Reduction Act (IRA), and the CHIPS and Science Act, there's plenty of good news to go around. NRDC and its partners were able to secure billions for a wide range of building decarbonization policies, spanning the full range of federal tools - from research funding to electrification tax credits to efficiency in low-income housing. And we continue to push for active oversight and higher expectations for federal programs, as well as meeting legal requirements to decarbonize federally-owned buildings.  

New Federal Funds for Building Decarb: Some of the most exciting new programs will offer rebates to low- and moderate-income households for efficiency and electrification projects in 2023 and beyond. Known as the HOMES and HEERA rebates (IRA sections 50121 and 50212, respectively), these two programs amount to $9 billion of support for vulnerable households to reduce their energy burden and carbon footprint without relying on or waiting for a tax credit. These funds will be administered by state governments, who recently learned their rebate program allocations in a notice from the U.S. Department of Energy (DOE). 

Phenomenal State Partners: Those consumer rebates are among several other programs that will rely on state implementation for success, and so this year we need to recognize the hard work by our counterparts working with and for state governments. In addition to HOMES and HEERA decarbonization rebates, states will also implement new or substantially increased funding for building energy codes, grid-interactive efficient buildings, and energy efficiency revolving loan programs. And that's just the major building decarbonization funding, not to mention all the decarbonized transportation and clean electricity funding that also depends on state implementation (for more on that, see the NRDC blog series on IRA and this IIJA state-focused explainer). 

Holistic Approach to the Climate Challenge: The above actions join a host of other recent federal policy changes demonstrating a whole-of-government approach to the climate crisis, with decarbonized buildings playing a key role. In addition to rebates and tax credits to spur efficiency and electric appliances mentioned above, the federal government has undertaken efforts to reduce the embodied emissions of key building materials, reinforce the supply chain and procurement of low-carbon materials for federally-funded buildings, expand research and development on technologies needed to decarbonize buildings, and ensure that groups underrepresented in Science, Technology, Engineering, and Math (STEM) have more opportunities to join a STEM profession.

Increasing Focus on Justice and Quality Jobs: Since Executive Order 14008 in January 2021 on tackling the climate crisis across the federal government, federal agencies have taken strides in how they address concerns over inequity in the transition to a decarbonized economy. Recent Requests for Information (RFI), like the one concerning the newly-created Greenhouse Gas Reduction Fund (GHGRF) at the Environmental Protection Agency, provide an opportunity for NRDC and our partners to offer suggestions on how to prioritize equitable building decarbonization and lift community voices in the process. Other RFIs allow NRDC to advocate for agencies to require more accountability in achieving Justice40 and quality job outcomes for programs that can fund building decarbonization, as we did for the Grid Resilience and Innovation Partnerships program at the Department of Energy (DOE). While the initial RFI addressed these priorities in general terms, we suggested active project management is needed to improve justice- and jobs-related outcomes, and DOE will now require all applicants to include at least one community benefits accountability milestone per budget period.

Plenty of Good Work for 2023: IIJA, IRA, and CHIPs have created over sixty new programs at DOE alone, setting up 2023 to be a year full of opportunities to advance equitable building decarbonization through many different federal policies. GHGRF money will start to flow, along with climate pollution plan funds for states and new climate justice block grants available to local governments and community-based organizations. Those three new EPA programs amount to $35 billion, so 2023 should be another year of progress for transitioning one of the most emissions-intensive sectors to clean and healthy buildings.

What an electrifying year for building decarbonization! And so much to do next year!