When a president invokes the Defense Production Act, it’s one of the rare moments the executive branch orders the private market to act. In the past, it has been used to boost production to help fight wars and battle a global pandemic. This week, President Biden used it for something a bit unexpected.
It’s not weaponry or some high-tech device, but building insulation. This humdrum material may not be anyone’s idea of advanced national security technology but, according to the Biden administration, it’s one of the key weapons we’ll need to combat energy waste amid a rapidly changing climate.
This invocation of the Defense Production Act (DPA) was announced on June 6, when the Biden administration issued a series of executive actions to accelerate the domestic production of clean energy. The actions include using the federal government’s procurement process to increase demand for domestically manufactured solar panels, and temporarily allowing the import of foreign components to kick domestic solar panel production into higher gear. And in order to increase the nation’s ability to use and conserve clean energy, Biden is calling on the insulation industry to get more of its products into walls. The act will incentivize manufacturers to increase their production of certain products and require them to accept contracts for the production of goods even if they may suffer a loss. Depending on the product, DPA orders can get factories fulfilling orders within days, weeks, or months.
It’s a somewhat banal focus for such a wide-reaching presidential power, especially one that’s rarely called to action. The law has been invoked sparingly since its passage in the 1950s, most often in the face of national security concerns. The Biden administration’s use of the DPA this week is focused on a broader kind of security threat. In its statement issuing these orders, the White House calls clean energy technologies “a critical part of the arsenal we must harness to lower energy costs for families, reduce risks to our power grid, and tackle the urgent crisis of a changing climate.”
The order calls for boosted production of more than just insulation. Other technologies include highly efficient heat pumps, new transformers, and components to improve the resilience of the electricity grid, and electrolyzers that can produce clean hydrogen energy. Most of these products are either specialized or for use in large-scale utilities. Insulation, on the other hand, is used just about everywhere—if unevenly.
Insulation is highly effective at bringing down energy use and costs. The EPA estimates that a properly insulated and sealed home can see annual energy cost savings of around 15%. The Department of Energy says that about half of homes in the U.S. were built before building codes required modern energy-saving insulation. The department estimates that retrofitting these buildings can cut energy use in half.
“Reducing energy waste in buildings is one of the most important climate actions you can take. And one of the main ways we reduce energy waste in buildings is through really good insulation,” says Stephen Walls, who focuses on building decarbonization at the Natural Resources Defense Council. “Insulation plays a really critical role even if it’s not as cool as a solar panel or electric vehicle or even a heat pump for that matter.”
Using the DPA to boost the production of insulation makes sense, Walls says, especially as building-focused funding from the bipartisan infrastructure bill begins to flow. “With the amount of money that’s going to be available not only for the federal government but also state and local governments to support retrofits for existing buildings, the demand for products like this is going to increase potentially quite dramatically,” Walls says.
At scale, better insulated homes can be a significant source of energy savings, particularly in older buildings. Eric Bradley is managing director of new energies and sustainability at the real estate company Taurus Investment Holdings, which has been investing in retrofitting workforce housing projects around the country. To help make these homes more affordable for people to live in, Taurus is focusing specifically on energy-saving upgrades like better insulation. Bradley says boosting the supply of insulation will only help make these retrofits more feasible across the housing spectrum. “From a social equity perspective, lower income consumers tend to live in older, less efficient building stock, so making improvements in energy efficiency can really help shield these consumers from energy price volatility and the impacts of high energy prices,” he says.
How quickly the insulation industry kicks into gear remains to be seen, but if the administration gets its way, factories across the country will start rolling out even more insulation to jam in the walls of homes and buildings. Let the energy savings begin.