On August 16, 2022, President Joe Biden signed the “Inflation Reduction Act”. The legislation includes many energy provisions that will impact American energy consumers and the industry as a whole.
Regarding the impacts on energy consumers, a PBS* article states:
According to a summary released by Senate Democrats, some of the funding aimed at consumers includes:
· $9 billion in home energy rebate programs to help people electrify their home appliances and for energy-efficient retrofits, with a focus on low-income consumers
· 10 years of consumer tax credits to make heat pumps, rooftop solar, electric HVAC and water heaters more affordable, which make homes more energy efficient
· $4,000 in consumer tax credits for lower- and middle-income individuals who buy used electric vehicles, and up to $7,500 tax credits for new EVs
· $1 billion grant program to make affordable housing more energy efficient
Regarding the impacts on the energy industry, the PBS article further states:
Bolstering domestic production of clean energy has national security implications. The package includes more than $60 billion to support “on-shore clean energy manufacturing in the U.S.,” with the goal of easing inflation and making future price shocks less likely by reducing the costs associated with clean energy options, according to the summary of energy and climate provisions within the bill. Additional funding includes:
· Production tax credits to help U.S. manufacturers accelerate production of solar panels, wind turbines, batteries, and process key minerals
· $10 billion investment tax credit for new manufacturing facilities that make clean tech like EVs, wind turbines and solar panels
· $500 million to use the Defense Production Act to speed manufacturing of things like heat pumps, as well as processing critical minerals
· $2 billion in grants to help automaker facilities transition to clean vehicle production
· Up to $20 billion in loans to construct new manufacturing facilities for clean vehicles
See the PBS article here: https://www.pbs.org/newshour/science/what-the-inflation-reduction-act-does-for-green-energy
* Many unofficial summaries of the legislation have been posted. We do not warrant the accuracy and completeness of the PBS summary.