Article Summary –
The Inflation Reduction Act (IRA), passed by the Biden Administration in 2022, is notable for its significant investments in clean energy, providing incentives for renewable energy implementation and funding clean energy companies. Despite environmental benefits and potential job growth, the IRA has simultaneously allowed for the fossil fuel industry to expand, with a concession to lease oil and gas development land in the Gulf of Mexico. Critics argue that while the IRA is the largest climate bill ever passed, its prioritization of economic benefits over environmental ones limits its capacity to significantly reduce greenhouse gas emissions and enhance the clean energy sector.
Climate Impact of the Inflation Reduction Act: Benefits and Drawbacks
Curious about the environmental and climate effects of the Inflation Reduction Act (IRA)? Implemented in 2022 by the Biden Administration, the IRA aimed to strengthen the U.S. economy with a significant emphasis on clean energy and climate health. Through budgeting $369 billion for climate investments, the Act encourages the use of renewable energy with increased tax benefits for households using solar panels and battery storage equipment, along with substantial support for clean energy companies. Experts predicted this move would pump $3 trillion into renewable energy, create 170,000 new jobs in the sector, and encourage more electric vehicle purchases.
Forecasts initially suggested that the IRA’s clean energy funding could slash America’s greenhouse gas emissions to about 40 percent below 2005 levels by 2030. This would be achieved by adding an estimated 46 to 79 gigawatts of carbon-free energy to the national grid annually. The Act also aims to make clean energy more affordable for disadvantaged communities and lower-income households, helping to reduce air pollution and carbon footprints in these areas.
However, the IRA has not prevented the fossil fuel industry from growing. The U.S. Senate only approved the bill after the Biden Administration agreed to sell a $200 million lease for oil and gas companies to develop a large plot of land in the Gulf of Mexico. The Act also stipulates that public lands and waters cannot be leased for renewable energy unless significant areas have already been offered for oil and gas leasing in the previous year.
Currently, fossil fuel use in the U.S. is experiencing record development and usage. Meanwhile, only 32 gigawatts of carbon-free energy have been added to the grid annually due to project delays, supply issues, and local community resistance. While the IRA focuses primarily on economic development, it still stands as the largest climate bill ever passed in U.S. history.
Related Links: Learn how the IRA can lower your energy bills at solar.com. Find out how the IRA’s tax incentives benefit all Americans at home.treasury.gov. Read about the U.S. oil and gas industry’s surprise win from the IRA at usatoday.com.
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