The Trump Administration has announced it is reversing an executive order (EO) signed by former President Joe Biden that utilized a Cold War-era law under the Defense Production Act, which included mandates for electric heat pumps.
In an effort to “reverse Biden’s failed policies,” President Trump’s latest action targets some of Biden’s “most damaging executive orders,” including Presidential Determination 2022-18 of June 6, 2022 (Presidential Determination Pursuant to Section 303 of the Defense Production Act of 1950, as amended, on Electric Heat Pumps).
According to previous reporting by ACHR NEWS, the order aimed to boost American heat pump manufacturing by phasing down reliance on foreign energy due to Russia’s war on Ukraine.
“On June 6, President Joe Biden invoked the Defense Production Act (DPA) to expand the manufacture and availability of energy-saving technologies, including heat pumps and solar,” ACHR NEWS reported. “The technologies, products, and component materials will be made in America.”
These technologies included heat pumps, insulation, transformers, and electric grid components.
Invoking the DPA paved the way for more federal investment in these technologies, and gave the president emergency authority, through executive order, to control U.S. domestic manufacturing by requiring private companies to prioritize and fulfill contracts with the federal government that address national needs.
While the immediate consequences of this latest action are still unclear, one industry veteran was skeptical that it would have a major impact on the role heat pumps are currently playing in the HVAC sphere.
Jack DiEnna, executive director and founder of the Geothermal National & International Initiative (GEO-NII), has worked in all aspects of the HVAC industry for over 50 years, and noted that it wasn’t the implementation of the DPA that sold heat pumps, it was a general market force from the consumer, who wanted more energy efficiency and less use of fossil fuel. As far as the consumer is concerned, he said, they probably have no idea this order was even in place.
DiEnna said the industry faced a similar situation with the investment tax credit — when it was taken away, people began speculating that they were no longer going to be able to sell heat pumps, which did not end up being the case.
“People have been selling heat pumps for a long, long time, and right now, heat pumps have never had better opportunities,” DiEnna said.
In this sense, DiEnna said right now the industry has to avoid becoming its own worst enemy — when the industry assumes a specific action is going to have an outsized impact, it’s going to be right, just as American industrialist Henry Ford famously said.
“Whether you think you can, or you think you can’t — you’re right,” DiEnna quoted.
DiEnna said the industry should be jumping at the other two executive orders that were signed in January, Unleashing American Energy and the declaration of a national emergency concerning energy, both of which should help reduce regulatory hurdles, enhance resource availability, and prioritize American-made products.
“I think this is our time,” he said.
DiEnna speculated that manufacturers sourcing foreign components would no doubt be affected, but they were likely going to take that hit because of tariffs, regardless.
Manufacturers are already exercising good margins, DiEnna said, and if this did result in prices going up, it’s not the end of the heat pump.
“It may raise the price a little bit, but if we make a big deal out of it, then people are going to think that they can’t sell — but nobody was selling (heat pumps) because of the Defense Production Act,” DiEnna said. “Unless you’re in our business, you don’t even know what that is.”
The technology itself is what’s going to keep heat pump popularity and adoption unstoppable, DiEnna said, not a single order signed by the previous president.
“Let’s face it — does the consumer really know anything about the manufacturers getting money?” DiEnna said.