Inflation Reduction Act Is Transformational and Sets Stage for Future Climate Action

August 7, 2022—“The Inflation Reduction Act passed today by the Senate includes transformational investments in climate solutions that will bring us closer to achieving U.S. climate goals,” said Daniel Bresette, executive director of the Environmental and Energy Study Institute (EESI). “Our pathway to limit global warming to 1.5°C by 2100 remains narrow, and we have a lot more to do. But the IRA represents historic climate legislation that, along with the Infrastructure Investment and Jobs Act, should give us optimism about our ability to rise to the challenge of climate change.”

The Inflation Reduction Act (IRA) would provide $369 billion—the largest such investment ever—to combat the climate crisis over the next 10 years and is expected to reduce carbon emissions by 40 percent by 2030. The legislation would expand tax credits for clean energy and electric vehicles, establish a national climate bank, support climate-smart agriculture, bolster production of sustainable aviation fuel, and reduce air pollution at ports. The House of Representatives is now expected to take up the IRA and send it to President Biden for his signature.

“The climate provisions in the IRA would lower household energy bills through energy efficiency and electrification, reduce U.S. dependence on foreign oil, decarbonize the electric grid and buildings, clean the air, and help get direct air capture, green hydrogen, and other emerging clean technologies to scale,” continued Bresette. “It would take new steps to see that these benefits are distributed equitably. And it would put a lot of people to work in quality jobs across the clean energy sector. These benefits represent improvements over business-as-usual, and will set the stage for future climate action.”