Biden’s New Climate Bill, Explained
President Biden’s energy bill (the IRA) is the most aggressive climate bill passed by a federal administration in history
This August, the Biden administration passed a comprehensive tax, health, and energy bill called the Inflation Reduction Act (the IRA). This new bill puts $369 billion toward climate and energy provisions, among other incentives for taxes and healthcare.
Cool…but what does that really mean?
$369 billion is a staggering figure, and “climate and energy provisions” is a pretty broad term. So let’s dig a little deeper into what this climate bill is actually aiming to accomplish.
Much of those $369 billion will bolster investments in electric cars and clean energy.
Billions of dollars will go toward expanding wind and solar power production. The hope is that this will make electric vehicles more affordable for average Americans. It will also make $1.5 billion available to oil companies to cut down their greenhouse gas emissions—and penalize them if they fail to do so.
The bill will also help develop crucial climate technologies, like carbon capture and sequestration, hydrogen, and small nuclear reactors, that are necessary to reach net-zero emissions by 2050. It’s also devoting $4 billion to address the climate-change-induced drought in the southwest, which is threatening water and power supply for some 40 million people along the Colorado River.
In other words, this bill is a pretty big deal.
This bill is huge, to say the least. It’s been described to “kick start the era of affordable clean energy in America.” This is the most that any administration has ever invested in climate change provisions.
According to the American Clean Power Association, the bill could help more than triple the clean power production in the country. It could help produce an additional 550 gigawatts of electricity from wind, solar, and other clean power sources. And the law has the potential to slice carbon production by roughly 1.1 billion tons by 2030, according to an analysis by the Department of Energy.
Since the bill’s passage, corporations have announced their own projects to produce the kind of technology the legislation promotes.
Toyota, for example, said it would invest an additional $2.5 billion in a factory in North Carolina to produce batteries for electric cars and hybrids. Honda and LG Energy Solution announced a joint venture to build a $4.4 billion battery factory. And First Solar said it would invest up to $1.2 billion to build its fourth factory in the United States, largely because of renewable energy incentives in the climate bill.
Sounds great, but there is a catch.
While the bill is historic, it’s fair to argue it isn’t nearly enough, given the years of climate inaction by the U.S. The country is the world’s number two carbon emitter and trails far behind Europe’s climate initiatives.
Still, we can be hopeful that this bill acts as a catalyst for more legislation and climate action. There’s a lot more work to be done!
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