Is the Inflation Reduction Act Doing Any Good?
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The government promised a profound, positive environmental change with the Inflation Reduction Act. Have they honored their word? It’s been nearly a year since they introduced it, but there seems to be insufficient coverage of the law’s impact. Is it doing any good?
What Is the Inflation Reduction Act?
The Inflation Reduction Act is a bipartisan bill passed by the Biden administration in August 2022. It provides funding opportunities like grants, loans and credits to those who participate in specific programs or qualify for aid. Although its primary purpose is economic growth, it also enormously benefits the environment.
In fact, it’s among the most significant climate legislation in the entire history of the United States. It’s extensive in terms of funding and reach and tackles multiple areas of environmental interest. It may not have “clean” or “green” in its name, but it still does a lot for the Earth.
What Were Its Original Environmental Goals?
Supporters of the Inflation Reduction Act claim it can significantly reduce carbon emissions, a likely outcome considering the United States is dedicating nearly $370 billion to address climate change. The funds go to various industries and residential areas across every state. Its original environmental goals were to support local and national transitions to clean energy.
The law’s goals focus on the environment in three main ways:
- Emission reduction: Many industries can get loans or grants to reduce carbon emissions.
- Green energy production: Manufacturing facilities and residential areas can receive repayment for producing or using renewable energy.
- Emission offset: Funding goes to various green programs — like electric vehicle implementation — to offset the nation’s total greenhouse gas emissions.
The timeline for a significant emission reduction and transition to clean energy is around a decade. President Joe Biden wants to cut them in half by 2030, which would
How Is It Addressing Climate Change?
While the inflation reduction act takes few direct steps to tackle climate change, it provides plenty of opportunities for others to do so — mainly through grants, credits, investments and loans.
The Inflation Reduction Act financially addresses climate change in three ways:
- Tax credits: It has many environmental programs that reduce taxable income to incentivize sustainable action. For example, two credits — production and investment — let taxpayers deduct a certain percentage from their federal income taxes.
- Incentives: It’s offering various grants and investments to businesses and households looking for greener options. For example, it dedicated around $27 billion to let states with low-income families afford solar or geothermal installations.
- Loans: It provides loans to organizations to reduce greenhouse gas emissions, transition to clean energy or manufacture sustainably. The temporary financial support helps them afford greener options until they recoup their money.
The law may not limit climate pollution or regulate greenhouse gas emissions, but it gives many green options for businesses, agencies, and individuals. Many are often wary of transitioning to sustainable alternatives because of the high initial cost, so its affordability is crucial.
How Does It Affect the Average Person?
Most people don’t spend too much time pouring over the fine details of legislation, so they often don’t find out how it can benefit them. The Inflation Reduction Act might focus a lot on business and manufacturing opportunities, but the average person can take advantage of it, too. For example, it provides a credit of up to $7,500 for purchasing a new electric vehicle — $4,000 for a used version — so households can better afford sustainable transportation.
Electric is an excellent sustainable alternative to gas power. The vehicles are much better for the environment because they produce zero carbon emissions on the road. Also, they’re often much more affordable to drive and maintain. The average person can benefit the Earth and save some extra money each month by taking advantage of the law.
Additionally, it offers incentives for those who update their breaker boxes, put in solar panels or add insulation. For example, it provides a 30% tax credit until 2032 for households installing renewable energy. It makes sustainability much more accessible for people.
What Are Its Environmental Impacts?
Although the United States hasn’t seen extensive change since the passing of the Inflation Reduction Act, people should expect that. It targets massive, long-term transitions, so it will take a while before people notice significant improvements. The various programs targeted at reducing greenhouse gas emissions and clean energy production will likely take months to go into effect — and years to make a significant impact. Still, it works behind the scenes, even if the process is slow.
Is It Doing Any Good?
Many of the changes the Inflation Reduction Act called for are already in effect. For example, the United States Postal Service (USPS) has already agreed to purchase 9,250 electric vehicles and 14,000 battery charging stations as of February 2023. Getting everything in order and finalizing the contracts took around six months.
Ultimately, it plans to make 66,230 of its own delivery vehicles electric and acquire 106,000 more elsewhere. It’s accomplished about 5% of its total commitment. Although that number seems small, they’re just getting started. The USPS has until 2028 to meet its goal for electric overhaul, which is more than enough time if it stays on track.
So far, the minor impacts have added up. By 2030, experts project the Inflation Reduction Act will reduce greenhouse gasses by up to 44% compared to 2005 levels. Without it, the United States would only reach up to a 35% reduction, meaning this single law provides a nearly 10% improvement. Although it’ll take a while, lawmakers set the timeline at around a decade because they knew this change would take a bit. It may not seem like much is happening, but it’s benefitting the environment.
This Law Benefits the Earth
It can be challenging to accept that positive change is happening without much evidence, but there are clear signs of the Inflation Reduction Act’s impact. Activists and environmental experts support it. On top of that, many significant transitions already started. It may take a while before the United States adopts clean energy, but it’s happening.
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About the author
Starting from an early age, Jane Marsh loved all animals and became a budding environmentalist. Now, Jane works as the Editor-in-Chief of Environment.co where she covers topics related to climate policy, renewable energy, the food industry, and more.