Vice President J.D. Vance is in his Ohio hometown today to promote the Trump administration’s “America First” economic agenda. Vance and Energy Secretary Chris Wright will visit a factory that was tagged to be a hallmark of Biden-era industrial decarbonization efforts, which now, under the Trump administration, will double down on coal.
The Cleveland-Cliffs steel plant was awarded up to $500 million in 2024 as part of the Department of Energy’s Industrial Demonstrations Program. The funding for that project, obligated by the Inflation Reduction Act, survived the Trump administration’s sweeping cancellations of federal awards last year, even as other major awards within the Office of Clean Energy Demonstrations were cancelled — and the office itself eventually shut down.
Last summer, however, Cleveland-Cliffs backed away from its green steel ambitions, telling investors at the time that it was negotiating with DOE to “explore changes to the scope to better align with the administration’s energy priorities.”
Cleveland-Cliffs, a key supplier to the automotive industry, was originally awarded funding to replace one of seven blast furnaces at its Middletown Works mill with new, cleaner equipment. Traditional steelmaking uses coal-fired blast furnaces to convert iron ore into iron before the steel refining stage. DOE funding was slated to replace that coal-reliant step with equipment that uses natural gas, and eventually hydrogen, to make iron, and then electric furnaces to turn it into steel.
The changes would have made Middletown Works “the most advanced, lowest GHG emitting integrated iron and steel facility in the world,” Cleveland-Cliffs said at the time. According to DOE, the project would eventually reduce around one million tons of greenhouse gas emissions annually and create 170 new permanent jobs and up to 1,200 construction jobs.
Now, Cleveland-Cliffs will still receive the full $500 million award, but will instead use it to conduct “state-of-the-art upgrades to its blast furnace, advanced material handling infrastructure, and artificial intelligence-enabled process control technologies,” the company said today. The project that Vance is in town to celebrate will now replace the inner lining of an old industrial furnace, and add a cogeneration unit that makes electricity and steam from waste gas — a longstanding technology that makes the steelmaking process overall more more efficient.
The total cost of the project is slated to be $1 billion; the OCED funding framework sees the government match what the company itself puts up. (The green steel version of the project had the same price-tag.)
The plan, if approved by state regulators, would likely lock the mill into using coal for the next several decades, thanks to high costs and long lead times. “DOE’s support for this project is a testament to the importance of preserving the blast furnace route to produce automotive-exposed grade steels in the U.S.,” CEO Lourenco Goncalves said.
Under the Inflation Reduction Act, Congress required these funds be used to enable “advanced industrial technology” designed to “accelerate greenhouse gas reduction progress to net-zero.”
Diverting those taxpayer dollars to continue a coal-burning furnace is “wildly illegal,” Georgetown University law and economics professor David Super told Latitude Media.
“Congress could not have been clearer in limiting these funds to projects involving renewable energy sources or that will otherwise reduce carbon emissions,” he said, adding that the administration may be assuming it won’t face legal challenges over the funds because nobody will have standing to sue. “The officials involved in funding this project in violation of the law, however, may be held responsible for misusing taxpayer funds,” Super said.
