Competition begins for DOE infrastructure act funds

Funding opportunity announcements make clear Biden Administration commitment to deliver on justice40 goals, create good jobs and encourage domestic economic activity

In November 2021, Congress passed, and President Biden signed into law, the Infrastructure Investment and Jobs Act (IIJA or the Act), which provides support for a broad array of clean energy activities.  The Department of Energy (DOE) was given $62 billion to support a range of activities, including: building out a domestic battery supply chain, developing advanced manufacturing capabilities, protecting nuclear plants at risk of closure, and enhancing the resilience of the electricity grid.  The Act also seeks to incentivize updates to building codes, improve the integration of intermittent renewable resources with other electricity sources, develop carbon storage technologies, develop the hydrogen economy, and improve energy efficiency in buildings. 

To preview its approach to funding these program areas and invite industry input, DOE released  a series of Requests for Information.  Now, DOE has begun issuing the Funding Opportunity Announcements (FOA) that formally initiate the competitions for the available funding.  Parties interested in pursuing awards in any of the program areas, including those for which DOE has not yet issued FOAs, should: 1) note the common themes that DOE prioritizes, and 2) begin work on their applications because the deadlines for completing applications are short. 

Some of the requirements that appear in the DOE FOAs authorized under the IIJA will be no surprise to those who have sought DOE funding in the past.  For instance, strong technical proposals, a team that demonstrates past success in executing complex projects, a budget plan that fits the proposal, and letters of commitment from project partners – whether they are subrecipients who will help carry out the project or customers for the project’s output – are all required elements for a strong application.  For those less familiar with federal funding, making commitments to grant the Government certain rights with respect to intellectual property created with government funding is likewise a standard requirement.

There are also some new elements in the recently issued FOAs that will require focused attention.  Some of these new considerations may make it a more challenging task to put together a compelling, compliant application. Those who are expecting to apply in areas funded under the IIJA where the FOAs have not yet been issued would do well to take note and start planning now for how they will meet these new requirements.

Environmental Justice

Prominent in DOE’s IIJA implementation has been the emphasis on the Biden Administration’s Justice40 initiative, Executive Order 14008, under which federal agencies are instructed to direct 40 percent of the benefits of the federal investment in clean energy to disadvantaged communities.  To demonstrate DOE’s support for this initiative, the FOA on Battery Recycling and Second Life Applications, DE-FOA-0002680, is instructive – identifying eight different ways that 40 percent objective can be achieved, ranging from direct reduction of the energy burden and environmental exposure in such communities to increasing access to low cost capital.

Workforce Considerations

The IIJA also emphasizes the importance of creating good paying jobs that will meet the future needs of our economy.  Consistent with this focus, in both the FOAs that have been released and in DOE’s Requests for Information about project areas that will be funded, DOE has stressed the need for applicants to demonstrate that they are responsible employers and that they provide not only safe working conditions, but also “the free and fair choice to form, join, or assist a union.”  There is no requirement that an applicant have a unionized workforce, but DOE identifies a letter of commitment from a union as an example of a component that might be included to support an application. 

Another common point of emphasis is DOE’s expectation that teams will include historically underrepresented groups in STEM jobs and minority-owned businesses and minority serving institutions on project teams.  DOE’s Battery Manufacturing FOA, DE-FOA-0002680, at 69-74, requires that each application for funding include an Equity Plan that identifies worker engagement and diversity, equity, inclusion and accessibility goals.  These are not intended to be merely aspirational.  The FOA provides that awardees “will be required to meet the elements proposed in the plan.”  Id. at 69.

Domestic Economy Focus

The Biden Administration’s dual goals of relieving global supply chain-induced shortages and encouraging the expansion of U.S. manufacturing capacity is apparent in DOE’s enhanced Buy American standards for DOE-funded projects.  Where recipients were previously called upon to acknowledge a “preference” that U.S.-made goods be used in the execution of work under a DOE award, there is now a formal waiver process required if an applicant proposes to use foreign-made iron, steel, manufactured products or construction materials in a DOE-funded infrastructure project.  Foreign-owned entities that seek awards, either as a prime recipient or a sub-recipient, must also obtain a waiver of the domestic entity requirement for recipients, based on a demonstration that, among other things, its participation is “in the best interest of the U.S. industry and U.S. economic development.” Id. at 128.

At this early date, it is not clear how these considerations will be addressed in each FOA that DOE issues under the IIJA, but it is fair to assume that the application process has become more demanding.  The Biden Administration is seeking to use federal infrastructure funding to ensure not only that the infrastructure improvements Congress called for are achieved, but also that awardees carry out the funded projects in a manner consistent with a broader set of Administration policy goals.

For more information on the DOE funding opportunities, please contact Mary Anne Sullivan, Senior Counsel, or Stephanie Fishman, Associate.

 

 

 

Authored by Mary Anne Sullivan and Stephanie Fishman.

 

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