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Evaluating Impacts of the Inflation Reduction Act and Bipartisan Infrastructure Law on the U.S. Power System

The Inflation Reduction Act of 2022 (IRA) and the Infrastructure Investment and Jobs Act of 2021, commonly referred to as the 'Bipartisan Infrastructure Law (BIL),' collectively represent the largest commitment of the U.S. Federal Government to invest in the modernization and decarbonization of the U.S. energy system. The Congressional Budget Office (CBO) estimates that total support for the broad range of climate and clean energy programs, tax credits, and other incentives authorized through the two laws will exceed $430 billion from 2022 through 2031 (CRS 2022; CBO 2021, 2022). While the climate and clean energy provisions are numerous and have the potential to impact all aspects of the U.S. energy system from fuel and electricity production to final consumption in industry, transportation, and buildings, the provisions relevant to the electricity sector - in particular the suite of tax credits for clean generation, storage, and carbon dioxide ( CO 2 ) capture and storage - are expected to be some of the most consequential in terms of emissions reduction and clean energy deployment (Larsen et al. 2022; Jenkins, Mayfield, et al. 2022; Mahajan et al. 2022; Zhao et al. 2022). In this report, we detail the methods and results of a study estimating the potential impacts of key provisions of IRA and BIL on the contiguous U.S. power sector from present day through 2030. The analysis employs an advanced power system planning model, the Regional Energy Deployment System (ReEDS), to evaluate how major provisions from both laws impact investment in and operation of utility-scale generation, storage, and transmission, and, in turn, how those changes impact power system costs, emissions, and climate and health damages. While not exhaustive in capturing every provision, the analysis estimates the possible scale of power-sector impacts that could result from the modeled provisions in IRA and BIL. The study is structured around two scenarios to evaluate the potential impacts of both laws on the power sector: 1) No New Policy: A counter-factual scenario that reflects all Federal and state policies enacted as of September 2022, with exception to IRA and BIL, and assumes load growth consistent with the Energy Information Administration's Annual Energy Outlook 2022 (AEO22) Reference case (EIA 2022a); 2) IRA-BIL: A scenario reflecting all Federal and state policies enacted as of September 2022, including key IRA and BIL provisions, most notably the investment and production tax credits for zero-carbon emitting electricity generation and storage (ITC and PTC), the tax credit for CO 2 capture and storage (45Q), and the tax credit for existing nuclear plants (described further in Section 2.3). To account for the impacts of IRA and BIL on electrification, assumes increased load growth consistent with a scaled version of the Medium Electrification scenario from the Electrification Futures Study (Mai et al. 2018). These scenarios are simulated across seven sets of assumptions with varying projected future electricity market conditions, including technology costs and performance, natural gas prices, and the degree of availability, feasibility, and cost of development of renewable resources, electricity transmission, and CO 2 pipeline, injection, and storage infrastructure. In addition, we simulate two sensitivities on the 'policy' treatment in which we vary key assumptions pertaining to the realized value of the clean electricity ITC and PTC: 1) the cost of monetization of tax credits, and 2) the level of bonus crediting realized by project developers. We demonstrate that IRA and BIL have the collective potential to drive substantial growth in clean electricity by 2030, while reducing costs for consumers, mitigating climate change, and decreasing the human health impacts of power sector emissions. However, we also demonstrate that if expected cost improvements of clean technologies are not realized and/or constraints on deployment driven by factors such as supply-chain challenges, regulatory hurdles, and the social acceptability of energy infrastructure development limit the rate of clean energy and associated infrastructure deployment (such as transmission), then the share of clean generation achieved and the associated emissions benefits realized may be substantively reduced.

29 ENERGY PLANNING, POLICY, AND ECONOMY↗

Analyzing the Inflation Reduction Act and the Bipartisan Infrastructure Law for Their Effects on Nuclear Cost Data

Decarbonizing to meet aggressive climate change mitigation targets requires energy transition within all sectors. In the industrial sector, emissions will need to decrease by 65–90% by 2050 to avert global warming greater than 1.5°C (IPCC 2022). The Inflation Reduction Act (IRA), Bipartisan Infrastructure Law (BIL), and Defense Production Act (DPA) have clean energy requirements and provide financial incentives to accelerate the use of clean energy technologies in the industrial sector. It is important to note that IRA is the most extensive action ever taken by Congress and the U.S. government to combat climate change (US CBO 2021, 2022). The energy system provisions comprise most of the estimated climate and energy support. A better understanding of those provisions in the above mentioned acts and laws is crucial to assessing their impact on the equivalent energy costs to the power plant owners (impact on net revenue in $/MWh) across different energy technologies, market deployment potential offered to different energy technologies applications, and energy system research modeling. The purpose of the report is to shed light on IRA and BIL provisions with particular attention to impacts on the nuclear industry. The report also seeks to understand potential equivalent energy cost savings for nuclear energy technologies from other laws and programs in conjunction with IRA, BIL, loan program guarantees, and DPA. The report reviews recent legislation on energy policy and translates that policy to impacts on equivalent nuclear costs for the purpose of modeling policy in energy scenarios.

11 NUCLEAR FUEL CYCLE AND FUEL MATERIALS↗

Bipartisan Infrastructure Law (BIL) – Illinois Rare Earth Novel Extraction and Supply (IRENES) - Report on Technology Down Select No. 1 - Acid Baking vs. Heap Leaching

An essential step for recovering rare earth and critical minerals from coal mine waste is one that achieves adequate dissolution of the target elements into a pregnant leachate solution. The simplest technical approach was thought to be heap-leaching that could proceed using mild acid dosing or naturally generated acid from biological activity. For this reason, the University of Kentucky at Lexington (UKY) undertook two efforts to evaluate feasibility, including a laboratory column leaching evaluation and a pilot heap-leaching demonstration. Later, the UK evaluated a pyrometallurgical approach using roasting combined with acid baking and tank leaching at elevated temperatures to improve extraction efficiencies. This report surveys the previously reported leaching yields and calculates the gross value of rare earth oxides as a basket in the pregnant leachate solution.

01 COAL, LIGNITE, AND PEAT↗

Bipartisan Infrastructure Law (BIL) – Illinois Rare Earth Novel Extraction and Supply (IRENES)

This report presents the physical and chemical characterization of breaker and sorter reject materials sourced from the Prairie State Generation facility, as part of the Illinois Rare Earth Novel Extraction and Supply (IRENES) project. Key analyses include particle size distribution, density, angle of repose, proximate and ultimate composition, mineralogy, and elemental content. Breaker reject material was found to be coarser and higher in ash content (~80%) with lower calorific value, while sorter reject showed finer distribution, lower ash (~68%), and higher carbon and energy content. XRD and XRF analyses confirmed the presence of REE-bearing minerals and relevant oxides, supporting process design and beneficiation strategy development for critical mineral recovery.

01 COAL, LIGNITE, AND PEAT↗

Newberry SHR Demonstration Project – Bipartisan Infrastructure Law Enhanced Geothermal (EGS) Pilot Demonstration (Abstract)

This project will create an Engineered Geothermal System (EGS) comprising two or more wells drilled to a depth of 4.25 km into superhot rock (SHR) with a temperature of 425 °C at Newberry Volcano in Central Oregon. An EGS is a manufactured heat exchanger in which water is injected in a deep injection well, or injector, to extract heat from the hot rock at depth and steam is returned to the surface in a production well, or producer, to generate electricity. In this project, the SHR EGS will be made using new methods and technologies to stimulate and connect hydraulic and natural fractures to enable multiple flow pathways between wells, allowing for optimal heat mining from the reservoir rock. The new technologies are designed to operate at rock temperatures much higher than those encountered in traditional geothermal. Following EGS completion, water will be injected into the injector well and steam extracted from the producer well in a long-term connectivity flow test demonstrating SHR reservoir evolution with time and use. Success will be measured by demonstrating the efficacy of new technologies and by producing economic quantities of steam (>40 MWth).

15 GEOTHERMAL ENERGY↗

National Zero-Emission Freight Corridor Strategy

The United States has committed to decarbonizing freight transportation by advancing the deployment of commercial zero-emission medium- and heavy-duty vehicles (ZEMHDVs) and infrastructure. It is pursuing this goal by leveraging historic federal and private investments, policies, and partnerships. Through the U.S. National Blueprint for Transportation Decarbonization1 and the Global Memorandum of Understanding for Zero-Emission Medium- and Heavy-Duty Vehicles,2 the United States has committed to identifying viable pathways and implementation actions that promote at least 30% ZE-MHDV sales by 2030, with a goal of 100% by 2040. These actions, along with the investments laid out in the Bipartisan Infrastructure Law and Inflation Reduction Act, put the nation on a path to advancing transportation and infrastructure solutions that are better for freight movement, our communities, the environment, and the economy. Providing ubiquitous and convenient access to electric vehicle (EV) charging and hydrogen refueling along our nation’s freight corridors, and at truck depots within freight hubs, is key to successfully deploying ZE-MHDVs. Consistent with its charge in the Bipartisan Infrastructure Law, 3 the Joint Office of Energy and Transportation (Joint Office), in collaboration with the U.S. Department of Energy (DOE), Department of Transportation, and the Environmental Protection Agency, has developed the National Zero-Emission Freight Corridor Strategy (Strategy). The Strategy guides infrastructure deployment to meet growing market demands; catalyze public and private investment; and support utility and regulatory planning and action at local, state, and regional levels.

33 ADVANCED PROPULSION SYSTEMS↗

Soft costs and EVSE – Knowledge gaps as a barrier to successful projects

There has been a recent push to increase access to electric vehicle (EV) charging infrastructure. The National Electric Vehicle Infrastructure (NEVI) program, part of the Bipartisan Infrastructure Law (BIL) has made significant funding available for major charging infrastructure projects along state thruways, and many state and local incentives exist for EV owners to install chargers in their homes. However, deployment of these chargers has not kept up with demand, primarily due to issues in project planning, permitting processes, and unforeseen delays. This paper serves as a review of the current understanding of these and other non-hardware costs in EV charging infrastructure projects (collectively known as “soft costs”). We found that soft costs in EV charging infrastructure projects are not well understood. Specifically, there is little agreement on how soft costs should be categorized and tracked, and less agreement still on best practices for controlling these costs and lowering barriers to infrastructure deployment. A broader review of EV charging infrastructure cost analyses shows that these costs can have significant impacts on project outcomes. EV charging infrastructure projects may be able to examine the success of the solar industry in lowering soft costs, and a similar effort may lower project costs significantly. Further work on standardizing and collecting data on EV charging infrastructure costs is required to begin addressing and controlling these costs.

32 - ENERGY CONSERVATION, CONSUMPTION, AND UTILIZA↗

Geospatial and Information Substitution and Anonymization Tool (GISA)

The Geospatial and Information Substitution and Anonymization Tool (GISA) incorporates techniques for obfuscating identifiable information from point data or documents, while simultaneously maintaining chosen variables to enable future use and meaningful analysis. This approach promotes collaboration and data sharing while also reducing the risk of exposure to sensitive information. GISA can be used in a number of different ways, including the anonymization of point spatial data, batch replacement/removal of user-specified terms from file names and from within file content, and aid with the selection and redaction of images and terms based on recommendations using natural language processing. Version 1 of the tool, published here, has updated functionality and enhanced capabilities to the beta version published in 2023. Please see User Documentation for further information on capabilities, as well as a guide for how to download and use the tool. If there are any feedback you would like to provide for the tool, please reach out with your feedback to edxsupport@netl.doe.gov. Disclaimer: This project was funded by the United States Department of Energy, National Energy Technology Laboratory, in part, through a site support contract. Neither the United States Government nor any agency thereof, nor any of their employees, nor the support contractor, nor any of their employees, makes any warranty, express or implied, or assumes any legal liability or responsibility for the accuracy, completeness, or usefulness of any information, apparatus, product, or process disclosed, or represents that its use would not infringe privately owned rights. Reference herein to any specific commercial product, process, or service by trade name, trademark, manufacturer, or otherwise does not necessarily constitute or imply its endorsement, recommendation, or favoring by the United States Government or any agency thereof. The views and opinions of authors expressed herein do not necessarily state or reflect those of the United States Government or any agency thereof. The Geospatial and Information Substitution and Anonymization Tool (GISA) was developed jointly through the U.S. DOE Office of Fossil Energy and Carbon Management’s EDX4CCS Project, in part, from the Bipartisan Infrastructure Law.

Bipartisan Infrastructure Law↗

Uncovering hidden market opportunities for advanced nuclear reactors

Decarbonizing to meet aggressive climate change mitigation targets requires energy transition within all sectors. In the industrial sector, global emissions will need to decrease by 65–90% by 2050 to avert warming greater than 1.5°C (Pörtner et al., 2022). Recent U.S. laws, including the Inflation Reduction Act (IRA), Bipartisan Infrastructure Law (BIL), Defense Production Act, Creating Helpful Incentives to Produce Semiconductors (or CHIPS), state programs, and other recent laws, have clean energy requirements and provide financial incentives to accelerate the use of clean energy technologies in the industrial sector. These new laws include supporting mechanisms with direct financial support for nuclear power (e.g., advanced reactor development and hydrogen production). However, advanced nuclear could also gain these financial benefits by coupling with low-carbon industrial projects. For example, microreactors could supply low-carbon energy to producers of critical metals that (1) are eligible to receive investment and production tax credits and favorable loans, and (2) the low-carbon product could gain preference in emerging markets for green products.

11 NUCLEAR FUEL CYCLE AND FUEL MATERIALS↗

Implementing the Inflation Reduction Act: What We Expect and How We Might Get There

This presentation summarizes findings from three related studies: Evaluating Impacts of the Inflation Reduction Act and Bipartisan Infrastructure Law on the U.S. Power System; The Roles and Impacts of PV-Battery Hybrids in a Decarbonized U.S. Electricity Supply; and Optimal Design and Deployment of Wind-Solar Hybrids in Low-Carbon U.S. Power System. The compilation of results from these three studies indicate that the Inflation Reduction Act could drive significant deployment of variable renewable energy technologies, but the level of deployment depends on our ability to build new transmission projects (among other factors). Hybrid systems can help, to an extent, to facilitate greater shares of wind/solar with lesser amounts of transmission expansion.

Bipartisan Infrastructure Law↗

Environmental life-cycle analysis of hydrogen technology pathways in the United States

Hydrogen is a zero-carbon energy carrier with potential to decarbonize industrial and transportation sectors, but its life-cycle greenhouse gas (GHG) emissions depend on its energy supply chain and carbon management measures (e.g., carbon capture and storage). Global support for clean hydrogen production and use has recently intensified. In the United States, Congress passed several laws that incentivize the production and use of renewable and low-carbon hydrogen, such as the Bipartisan Infrastructure Law (BIL) in 2021 and the Inflation Reduction Act (IRA) in 2022, which provides tax credits of up to $3/kg depending on the carbon intensity of the produced hydrogen. A comprehensive life-cycle accounting of GHG emissions associated with hydrogen production is needed to determine the carbon intensity of hydrogen throughout its value chain. In the United States, Argonne’s R&D GREET ® (Greenhouse Gases, Regulated emissions, and Energy use in Technologies) model has been widely used for hydrogen carbon intensity calculations. This paper describes the major hydrogen technology pathways considered in the United States and provides data sources and carbon intensity results for each of the hydrogen production and delivery pathways using consistent system boundaries and most recent technology performance and supply chain data.

Elgowainy, Amgad↗

The geographies, typologies, and trends of community-based organizations for solar energy in the United States

Community-based organizations (CBOs)1 play an important role in developing solar energy in low- and moderate-income (LMI) communities. This article shares the perspectives of CBO leaders in LMI communities, identifies and addresses solar information gaps, and provides recommendations State Energy Agencies and other government leaders can use to better involve CBOs in solar program initiatives. Using semi-structured interviews and focus groups with CBOs from across the United States (US) we develop typologies of CBO structure and function, and determine the primary motivations, challenges, opportunities, and communication barriers CBOs face. We explore the correlation between key typologies such as tenure, staff capacity, population served, organizational structure, and region with the organizational activities performed by solar-related CBOs. CBOs operate in disparate regional political and economic ecologies. Our findings suggest strategies for states to support their engagement in solar-related endeavors, particularly with respect to the dissemination of the Bipartisan Infrastructure Law, Inflation Reduction Act, and the EPA Greenhouse Gas Reduction Fund: Solar for All. Developing policies that encourage CBOs to enter the solar training and installation domains, alongside targeted grants and capacity-building initiatives can help maximize community benefits. Furthermore, states can additionally contribute to the positive trajectory and collaboration between state agencies and CBOs in advancing solar energy adoption by fostering a supportive environment.

14 SOLAR ENERGY↗

High-ambition climate action in all sectors can achieve a 65% greenhouse gas emissions reduction in the United States by 2035

Under the next cycle of target setting under the Paris Agreement, countries will be updating and submitting new nationally determined contributions (NDCs) over the coming year. To this end, there is a growing need for the United States to assess potential pathways toward a new, maximally ambitious 2035 NDC. In this study, we use an integrated assessment model with state-level detail to model existing policies from both federal and non-federal actors, including the Inflation Reduction Act, Bipartisan Infrastructure Law, and key state policies, across all sectors and gases. Additionally, we develop a high-ambition scenario, which includes new and enhanced policies from these actors. We find that existing policies can reduce net greenhouse gas (GHG) emissions by 44% (with a range of 37% to 52%) by 2035, relative to 2005 levels. The high-ambition scenario can deliver net GHG reductions up to 65% (with a range of 59% to 71%) by 2035 under accelerated implementation of federal regulations and investments, as well as state policies such as renewable portfolio standards, EV sales targets, and zero-emission appliance standards. This level of reductions would provide a basis for continued progress toward the country’s 2050 net-zero emissions goal.

54 ENVIRONMENTAL SCIENCES↗

Characterizing the Geothermal Lithium Resource at the Salton Sea

The energy transition towards a more sustainable and renewable future is a pivotal global endeavor. Central to this shift for the United States is the critical role of domestically sourced lithium, a key mineral in the production of high-performance batteries essential for electric vehicles and renewable energy storage systems. This has driven the United States to invest heavily in a domestic supply chain for batterygrade lithium to enhance energy security, reduce supply chain vulnerabilities, and foster economic growth by tapping into local resources. A notable example is the Biden Administration’s “American Battery Materials Initiative,” which was included in the $2.8-billion Bipartisan Infrastructure Law (The White House, 2022).

25 ENERGY STORAGE↗

Securing the Clean Energy Transition with Cyber-Informed Engineering

The Bipartisan Infrastructure Law kick-started a surge in clean energy investments in the United States. Securing these systems and their supporting infrastructure from the outset is imperative, starting from the conceptual design and continuing through the entire engineering lifecycle. Cyber-Informed Engineering is an ideal approach to seamlessly integrate the necessary advanced control capabilities and adaptive protection systems, especially considering the trend towards cloud-based infrastructure and process controls. Learn more about CIE at https://www.energy.gov/ceser/articles/cyber-informed-engineering-bridge-between-cyber-and-critical-infrastructure-securing.

14 SOLAR ENERGY↗

An Evaluation Framework for State Energy Offices' Energy Efficiency and Clean Energy Workforce Programs

Historic levels of funding for energy efficiency and clean energy projects from the Bipartisan Infrastructure Law and Inflation Reduction Act will be flowing through State Energy Offices (SEOs) in the coming years, including funds specifically for supporting workforce development efforts. This report offers a workforce evaluation framework that they can use to track and measure the progress, performance, and effectiveness of energy efficiency and clean energy workforce programs that they fund and/or implement. This evaluation step is essential to ensuring that SEOs' workforce efforts remain relevant to the evolving needs of the energy efficiency and clean energy sector and advance a workforce that is inclusive and diverse thus maximizing the success of their programs.

32 ENERGY CONSERVATION, CONSUMPTION, AND UTILIZATI↗

Second Target Station Project: STS Cross-Directorate Workshop on Hydrogen Fuel

Hydrogen, particularly green hydrogen produced through electrolysis using renewable energy, is poised to play a critical role in decarbonizing the global economy. Its ability to address the intermittency of renewable energy sources and decarbonize hard-to-electrify sectors positions it as a vital component of a sustainable energy future. Interest in hydrogen as a clean energy carrier is in a decade of unprecedented growth, with dozens of countries having released national hydrogen strategies contributing to a global hydrogen economy. In 2021, the Department of Energy (DOE) announced the Hydrogen Shot, the first of the Energy Earthshot Initiatives, which aims to lower the cost of clean hydrogen to $\$$1/kg by 2031. This initiative was followed by a considerable increase in funding for hydrogen technologies through the Bipartisan Infrastructure Law (BIL), with $\$$18 billion recently announced for regional demonstration projects (Hydrogen Hubs) and another $\$$11.5 billion aimed at research and development of electrolyzers, fuel cells, manufacturing, and recycling. The 2023 U.S. National Clean Hydrogen Strategy and Roadmap identifies the cost of clean hydrogen as a critical challenge for achieving economic scale. This includes the cost of hydrogen production by electrolysis, delivery and dispensing, onboard storage, and end-use technologies like fuel cells. Fundamental research and development into catalysts, component architectures, and material durability are critical to lower the costs of these vital technologies aimed at achieving a net-zero carbon emission economy by 2050.

08 HYDROGEN↗

Paving the way for Stakeholder use of Carbon Storage & Transport Digital Resources

This online resource is intended to provide a comprehensive “one-stop-shop” for understanding the availability of tools, data, and models developed under the Bipartisan Infrastructure Law (BIL) as they relate to supporting stakeholders’ Carbon Storage and Transport needs. To support accessibility of these BIL products, supplemental information regarding project life-cycle relevance, update history, release dates, input and output formats, and example use-cases will be integrated into consistent and accessible Story Map formats. This presentation is to update on the progress of this effort and detail anticipated next steps associated with ongoing development.

Martin, Abigail↗