The U.S. Department of Energy cut funding for two dozen clean energy projects across the U.S., including a $170 million grant for Chicago-based food manufacturer Kraft Heinz at 10 U.S. plants, including one in Champaign.
The cuts also include a $75 million grant for Diageo’s facilities in Plainfield and Shelbyville, Kentucky. The beverage giant’s brands include Johnnie Walker and Smirnoff.
U.S. Secretary of Energy Chris Wright on Friday announced the cancellation of 24 grants worth more than $3.7 billion, which were awarded during President Joe Biden’s administration.
“DOE found that these projects failed to advance the energy needs of the American people, were not economically viable and would not generate a positive return on investment of taxpayer dollars,” the agency said in a news release.
At the 10 plants, Kraft Heinz planned to install technologies such as heat pumps, electric heaters, electric boilers, anaerobic digestors, biogas boilers, solar thermal, solar photovoltaic and thermal energy storage, the company said in a news release last year.
By 2030, Kraft Heinz expected to decrease the use of natural gas at those sites by 97% and lower energy use by 23%.
The Champaign plant is Kraft Heinz’s largest facility by volume production in North America, according to its website. The site has more than 1,000 employees and makes Kraft Mac and Cheese, Miracle Whip, ketchup, A.1. sauce and other products.
Kraft Heinz anticipated creating about 500 construction jobs across the 10 plants that included Champaign; Columbia, Missouri; Fremont, Ohio; Holland, Michigan; Kendallville, Indiana; Lowville, New York; Mason City and Muscatine, Iowa; New Ulm, Minnesota; and Winchester, Virginia.
Kraft Heinz said in an emailed statement that it’s aware of the Energy Department’s “unilateral” decision.
“While we will continue to evaluate this decision, it does not change our intention to continue investing in our 30 U.S. manufacturing facilities. Over the next approximately five years, we plan to invest $3 billion to modernize our U.S. supply chain infrastructure. We will continue to drive energy efficiency projects forward as we make these investments,” Kraft Heinz said.
Diageo’s grant, announced in March 2024, aimed to electrify production sites in Plainfield and Kentucky to make them carbon neutral by 2028 and 2026, respectively, according to a company news release last year.
Its Plainfield facilities, located more than an hour southwest of Chicago, include a bottling plant, opened in 1966, and a warehouse that employ more than 600.
Diageo planned to partner with Rondo Energy of California to install heat batteries to capture and store renewable energy, while eliminating reliance on natural gas for boilers used in heating.
Beverage industry production — including distilling, bottling, cleaning, pasteurization and HVAC systems — is energy-intensive and typically uses natural gas for heat. The new technology sought to replace natural gas and eliminate nearly 17,000 metric tons of direct greenhouse gas emissions each year at the Plainfield and Kentucky facilities, said Diageo’s news release last year. That’s “the equivalent of taking more than 4,046 gasoline-powered cars off the road for a year.”
Diageo touted the project as a potential model for industrial heat systems in other sectors such as steel, paper, concrete and glass, as well as food and beverage.
Diageo did not reply to requests for comment.
Advocacy group Industrious Labs said in a news release Friday, “Pulling the plug at this stage not only wastes public and private resources, it stalls urgently needed upgrades in a region heavily impacted by industrial air pollution. Cutting these projects also means violating legal contracts signed in good faith by private companies and the U.S. government.”
Evan Gillespie, partner at Industrious Labs, said in the release, “The Trump administration rolled out tariffs, arguing that these measures are necessary to revive manufacturing — yet, at the same time, they are canceling manufacturing projects nationwide and increasing energy costs for manufacturers.”
Gillespie added, “Canceling these projects also hurts American workers and regions most in need of investment, handing a competitive advantage to Europe, China, Canada, and other nations that are making significant investments in clean manufacturing while leaving the U.S behind.”