Facilitating the Reshoring of Energy Grid Component Manufacturing Act of 2022
Bill: S.4626 | Sponsor: Sen. Rubio, Marco (R-FL)
Policy area: Energy

Summary:
Facilitating the Reshoring of Energy Grid Component Manufacturing Act of 2022
This bill directs the Department of Energy (DOE) to establish a loan program for the production of energy grid products or components. Under the program, DOE may provide loans for activities related to projects that reequip, expand, or establish manufacturing facilities to produce energy grid products or their components. Energy grid products include large power transformers or any other electrical equipment commonly used for the transmission or distribution of electric energy by public electric utilities.

To require the Secretary of Energy to establish a program to provide 
     loans to manufacturers of energy grid products and components.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Facilitating the Reshoring of Energy 
Grid Component Manufacturing Act of 2022''.

SEC. 2. ENERGY GRID PRODUCT AND COMPONENT MANUFACTURING IN THE UNITED 
              STATES.

    (a) Definitions.--In this section:
            (1) Component.--The term ``component'' means any part or 
        element of an energy grid product.
            (2) Eligible project.--The term ``eligible project'' means 
        a project to reequip, expand, or establish (including through 
        new construction) a manufacturing facility in the United States 
        to produce energy grid products or components.
            (3) Energy grid product.--The term ``energy grid product'' 
        means--
                    (A) a bulk-power system (as defined in section 
                215(a) of the Federal Power Act (16 U.S.C. 824o(a)));
                    (B) a large power transformer;
                    (C) a switchgear or breaker;
                    (D) a converter;
                    (E) a direct current filter;
                    (F) an alternating current switch or switchyard;
                    (G) an insulated-gate bipolar transistor;
                    (H) a capacitor;
                    (I) an inductor;
                    (J) an arrestor;
                    (K) a resistor;
                    (L) a distribution transformer;
                    (M) grain-oriented electrical steel;
                    (N) continuously transposed conduction (CTC) copper 
                wire;
                    (O) silicon steel;
                    (P) any insulating material; and
                    (Q) any other electrical equipment commonly used 
                for the transmission or distribution of electric energy 
                by public electric utilities.
            (4) Secretary.--The term ``Secretary'' means the Secretary 
        of Energy.
    (b) Loan Program.--
            (1) Establishment.--
                    (A) In general.--Not later than 180 days after the 
                date of enactment of this Act, and subject to the 
                availability of appropriated funds, the Secretary shall 
                establish and carry out a program to provide a total of 
                not more than $8,000,000,000 in loans to eligible 
                individuals and entities (as determined by the 
                Secretary) for the costs of activities relating to 
                eligible projects.
                    (B) Financing method.--
                            (i) In general.--Except as provided in 
                        clause (ii), a loan under this subsection shall 
                        be provided through the Federal Financing Bank, 
                        with the full faith and credit of the United 
                        States Government on the principal and 
                        interest.
                            (ii) Cooperation with other institutions.--
                        A loan under this subsection may be provided in 
                        cooperation with 1 or more banks or other 
                        financial institutions through agreements to 
                        participate on an immediate or deferred 
                        (guaranteed) basis.
                    (C) Credit subsidy.--The full credit subsidy for 
                each loan provided under this subsection shall be paid 
                by the Secretary using appropriated funds.
            (2) Application.--An individual or entity desiring a loan 
        under this subsection shall submit to the Secretary an 
        application at such time, in such manner, and containing such 
        information as the Secretary may require, including a written 
        assurance that--
                    (A) all laborers and mechanics employed by 
                contractors or subcontractors during any construction, 
                alteration, or repair that is financed, in whole or in 
                part, by a loan provided under this subsection shall be 
                paid wages at rates not less than those prevailing on 
                projects of a character similar in the locality, as 
                determined by the Secretary of Labor in accordance with 
                sections 3141 through 3144, 3146, and 3147 of title 40, 
                United States Code; and
                    (B) the Secretary of Labor shall, with respect to 
                the labor standards described in this paragraph, have 
                the authority and functions set forth in Reorganization 
                Plan Numbered 14 of 1950 (5 U.S.C. App.) and section 
                3145 of title 40, United States Code.
            (3) Selection of loan recipients and eligible projects.--
                    (A) In general.--The Secretary may provide a loan 
                under this subsection if the Secretary determines 
                that--
                            (i) the loan recipient--
                                    (I) has a reasonable prospect of 
                                repaying the principal and interest on 
                                the loan;
                                    (II) will provide sufficient 
                                information to the Secretary for the 
                                Secretary to ensure that the loan 
                                proceeds are expended efficiently and 
                                effectively; and
                                    (III) has met such other criteria 
                                as may be established and published by 
                                the Secretary; and
                            (ii) the amount of the loan (when combined 
                        with amounts available to the loan recipient 
                        from other sources) will be sufficient to carry 
                        out the eligible project for which the loan is 
                        provided.
                    (B) Reasonable prospect of repayment.--The 
                Secretary shall base a determination of whether there 
                is a reasonable prospect of repayment of the principal 
                and interest on a loan under subparagraph (A)(i)(I) on 
                a comprehensive evaluation of whether the loan 
                recipient has a reasonable prospect of repaying the 
                principal and interest, including, as applicable, an 
                evaluation of--
                            (i) the strength of the contractual terms 
                        of the applicable eligible project (if 
                        commercially reasonably available);
                            (ii) the forecast of noncontractual cash 
                        flows supported by market projections from 
                        reputable sources, as determined by the 
                        Secretary;
                            (iii) cash sweeps and other structure 
                        enhancements;
                            (iv) the projected financial strength of 
                        the loan recipient--
                                    (I) at the time of loan close; and
                                    (II) throughout the loan term after 
                                the applicable eligible project is 
                                completed;
                            (v) the financial strength of the investors 
                        and strategic partners of the loan recipient, 
                        if applicable; and
                            (vi) other financial metrics and analyses 
                        that are relied on by the private lending 
                        community and nationally recognized credit 
                        rating agencies, as determined to be 
                        appropriate by the Secretary.
            (4) Rates, terms, and repayment of loans.--A loan provided 
        under this subsection--
                    (A) shall have an interest rate that, as of the 
                date on which the loan is provided, is equal to the 
                cost of funds to the Department of the Treasury for 
                obligations of comparable maturity;
                    (B) shall have a term equal to the lesser of--
                            (i) the projected life, in years, of the 
                        eligible project to be carried out using 
                        proceeds from the loan, as determined by the 
                        Secretary; and
                            (ii) 20 years;
                    (C) may be subject to a deferral in repayment for 
                not more than 5 years after the date on which the 
                eligible project carried out using proceeds from the 
                loan first begins operations, as determined by the 
                Secretary;
                    (D) shall be made by the Federal Financing Bank; 
                and
                    (E) shall be subject to the condition that the loan 
                is not subordinate to other financing.
            (5) Conflicts of interest.--For each loan provided under 
        this subsection, the Secretary shall certify that political 
        influence did not affect the provision of the loan, including--
                    (A) selection of the eligible project for which the 
                loan was provided; and
                    (B) selection of the loan recipient.
            (6) Administrative fee.--The Secretary may charge a fee for 
        the administrative and closing costs of a loan provided under 
        this subsection, subject to the condition that the fee does not 
        exceed the lesser of--
                    (A) $100,000; and
                    (B) 10 basis points of the principal amount of the 
                loan.
    (c) Improvement.--Not later than 90 days after the date of 
enactment of this Act, the Secretary shall promulgate an interim final 
rule establishing regulations that the Secretary determines to be 
necessary to administer this section and any loans provided by the 
Secretary under subsection (b).
    (d) Priority.--
            (1) In general.--In providing loans under this section to 
        manufacturers (including component suppliers) that have 
        existing facilities, the Secretary shall give priority to 
        manufacturers that are seeking to expand manufacturing output 
        through--
                    (A) the establishment of 1 or more new facilities; 
                or
                    (B) the reopening of 1 or more facilities.
            (2) Idle facilities.--A facility described in subparagraph 
        (A) or (B) of paragraph (1) may be sitting idle as of the date 
        on which the applicable loan is provided under this section.
    (e) Set Aside for Small Energy Grid Product Manufacturers and 
Component Suppliers.--
            (1) Definition of covered firm.--In this subsection, the 
        term ``covered firm'' means a firm that--
                    (A) employs fewer than 500 individuals; and
                    (B) manufactures energy grid products or 
                components.
            (2) Set aside.--Of the amounts used to provide loans each 
        fiscal year under subsection (b), the Secretary shall use not 
        less than 5 percent to provide loans to--
                    (A) covered firms; or
                    (B) consortia led by covered firms.
    (f) Appointment and Pay of Personnel.--
            (1) In general.--The Secretary may use direct hiring 
        authority pursuant to section 3304(a)(3) of title 5, United 
        States Code, to appoint such professional and administrative 
        personnel as the Secretary determines to be necessary to carry 
        out this section and any functions of the Secretary under this 
        section.
            (2) Rate of pay.--The rate of pay for a person appointed 
        pursuant to paragraph (1) shall not exceed the maximum rate 
        payable for GS-15 of the General Schedule under chapter 53 of 
        title 5, United States Code.
            (3) Consultants.--The Secretary may retain, pursuant to 
        section 1901 of title 41, United States Code, such consultants 
        as the Secretary determines to be necessary to carry out this 
        section and any functions of the Secretary under this section.
    (g) Outreach.--In carrying out this section, the Secretary shall--
            (1) provide assistance with the completion of applications 
        for loans under this section; and
            (2) conduct outreach, including through conferences and 
        online programs, to disseminate information about loans under 
        this section to potential applicants.
    (h) Report.--Not later than 2 years after the date of enactment of 
this Act, and every 2 years thereafter, the Secretary shall submit to 
Congress a report on the status of projects supported by a loan under 
this section, including--
            (1) a list of projects for which a loan was provided under 
        this section, including, with respect to each project--
                    (A) the loan amount; and
                    (B) the construction status of the project;
            (2) the status of the loan repayment for each project, 
        including future repayment projections;
            (3) data regarding the number of direct and indirect jobs 
        retained, restored, or created by financed projects;
            (4) a projection of the number of new projects for which 
        the Secretary expects to provide a loan under this section 
        during the 2-year period beginning on the date of the report, 
        including the projected aggregate loan amount over that 2-year 
        period;
            (5) an evaluation of ongoing compliance with the assurances 
        and commitments (and the accuracy of any predictions) made by 
        applicants pursuant to paragraphs (2) and (3) of subsection 
        (b);
            (6) the total number of applications received by the 
        Secretary each year; and
            (7) any other metrics that the Secretary determines to be 
        appropriate.
    (i) Funding.--
            (1) Rescission.--Of the unobligated balance of amounts made 
        available by section 129 of division A of the Consolidated 
        Security, Disaster Assistance, and Continuing Appropriations 
        Act, 2009 (Public Law 110-329; 122 Stat. 3578), $2,400,000,000 
        are rescinded.
            (2) Direct appropriation.--If sufficient unobligated 
        amounts made available by section 129 of division A of the 
        Consolidated Security, Disaster Assistance, and Continuing 
        Appropriations Act, 2009 (Public Law 110-329; 122 Stat. 3578), 
        are available on the date of enactment of this Act to execute 
        the entire rescission described in paragraph (1), on the day 
        after the execution of the entire rescission, there is 
        appropriated to the Secretary, out of amounts in the Treasury 
        not otherwise appropriated, $2,400,000,000 to carry out this 
        section, to remain available until expended.
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