The U.S. Inflation Reduction Act is attracting billions of dollars in private investment for clean energy, both domestically and abroad.
The legislative package was passed by Congress and signed into law by President Joe Biden last year with the goal of fighting inflation. But the bill is also viewed by many as a revolutionary measure for the renewable energy sector.
For one, it includes at least $391 billion in climate tech funding as long as part of the production of the renewable energy apparatus (solar panels, batteries for electric vehicles, etc.) takes place in the United States, Canary Media reported.
Part of the bill’s goal is to entice companies to manufacture their products within the U.S. to make the country more self-sufficient in the production of clean energy, and it has succeeded in attracting billions of dollars in clean energy from within the country and abroad.
The U.S. is second to China as the country that produces the most planet-warming gases, accounting for about 13.5% of global carbon pollution (compared to China’s 30.9%), according to Our World in Data’s latest available measures from 2021.
According to Smithsonian Magazine, the global increase in renewable energy is expected to offset over 661 million tons of planet-warming toxic carbon pollution in the coming years. This number may end up being much higher if the U.S. exceeds expectations in the creation of renewable energy.
Canary Media reported that there have been close to 100 recently-announced clean energy manufacturing facilities or expansions of existing factories in the United States. These announcements span from last August, when President Biden signed the law, to now.
Unlike in many other countries, the U.S. transportation sector produces more harmful planet-warming gases — at 29% of the total — than the electricity production sector does.
According to the United Nations, “By achieving a 60% share of battery-electric and plug-in hybrid vehicles on the road, more than 60 billion tons of CO2 could be saved between now and 2050.”
“The United States is effectively now the most attractive destination for global capital in clean energy and cleantech,” said Aaron Brickman, senior principal in the U.S. program of clean energy think tank RMI, as reported by Canary Media.
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