On August 16th, 2022, the Inflation Reduction Act (IRA) was signed into law by the Biden-Harris Administration. This historic piece of climate legislation is unprecedented in the amount of funding dedicated towards climate and clean energy programs. Now more than ever before, climate risk is gaining momentum as one of the most pressing issues facing businesses and communities around the world. This anniversary comes at a point where the U.S. is preparing for a change in administration during the November presidential election and faces challenges from the Supreme Court regarding regulations from federal agencies like the EPA.
During this crucial moment, we must take the time to reflect on the foundation set by the IRA, address challenges and opportunities, and look forward to which programs and issue areas are at the forefront of the national and international conversations on climate change and clean energy. As we reflect on how far we have come from last year’s update [RELINK LOCAL], here are 5 ways the Inflation Reduction Act is shaping the clean energy future:
1. Historic Contributions to Climate Resiliency
The IRA has contributed 334,565 new jobs, driving $372 billion in new investments across 47 states and Puerto Rico. Along with more climate-positive job growth, exciting clean energy projects have been announced across the country. Now, on the second anniversary of the IRA, we can note the success of these programs and begin to set the foundation for climate and clean energy in the years to come.
2. IRA Program Implementation
We are now firmly in the implementation phase of the IRA rollout, which means that the exciting projects announced over the past two years have begun to fund projects and create opportunities across the country for businesses, communities, and individuals.
- The Greenhouse Gas Reduction Fund is a $27 billion program that combines financing and private capital through several programs, including the National Clean Investment Fund, Clean Communities Investment Accelerator, and Solar for All programs to fund projects that will reduce greenhouse gas emissions.
- The IRA created the Environmental and Climate Justice Program (ECJ Program) under the EPA to provide financial and technical assistance for environmental justice initiatives. A key initiative is the Community Change Grants, with proposals open until November 21, 2024.
- The American Climate Corps program connects early-career climate professionals with clean energy jobs across the country. The portal opened in April, and these jobs train youth to work on climate solutions and prepare them for future career opportunities in clean energy.
3. Protecting Climate Smart Agriculture
Every five years, Congress must pass the Farm Bill, which funds the USDA. Current negotiations have been ongoing since 2021, with a historic $20 billion from the IRA set to support climate-smart agriculture programs. These funds promote regenerative agriculture and must be protected [RELINK LOCAL] from legislative and financial cuts.
Additionally, the IRA Discrimination Financial Assistance Program has directed $2.2 billion to support farmers and ranchers who experienced discrimination in USDA lending programs. This step acknowledges historic injustices and aims to promote a more equitable agricultural landscape.
4. Grid Interconnection
Critics of the transition to clean energy often cite outdated and misleading claims about clean energy reliability. While some challenges are real, many are overstated or incorrect. One challenge—grid interconnection—requires funding and policy updates to ensure clean energy access in rural communities and tribes.
The Treasury Department has begun a rulemaking process to simplify clean energy tax credits. ASBN submitted a comment calling for careful implementation to ensure small businesses and tribal projects benefit without unintended loopholes for fossil fuels.
5. Manufacturing
The IRA has significantly boosted U.S. clean energy manufacturing, particularly in communities historically reliant on coal, steel, and other polluting industries.
- The IRA was projected to create 900,000 jobs through $50 billion in clean manufacturing investments.
- At the two-year mark, over 300,000 clean energy jobs have been created for mechanics, electricians, construction workers, and others.
- New projects are transforming former coal and steel industry sites into hubs for sustainable energy production.
A Note on Chevron Deference
Our ability to continue implementing IRA funding and creating green jobs requires regulatory stability. However, recent Supreme Court rulings in Loper Bright Enterprises v. Raimondo and Relentless Inc. v. Department of Commerce overturned Chevron deference [RELINK LOCAL], which previously allowed courts to defer to agency expertise in regulatory matters. Without it, businesses and federal agencies face uncertainty in climate regulations.
Conclusion
The Biden-Harris Administration has set ambitious goals to cut carbon pollution, improve conservation efforts, and promote environmental justice. With two years of substantial federal funding in place and a new administration on the horizon, it’s critical to highlight the successes of the IRA and continue advocating for policies that drive a sustainable economy.
Business—and life as we know it—is on the line. Climate risk is a real and present threat to business viability. Together, ASBN members are advancing the business voice in support of historic programs like the IRA and pushing for future initiatives that create jobs, strengthen supply chains, and promote sustainability.
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