The last few weeks have shown us that what at one moment appears impossible can suddenly become reality. When Sen. Joe Manchin (D-W.Va.) withdrew his support from the climate bill on July 15, I despaired. Yet only a month later we are celebrating a truly historic victory.
President Biden and Majority Leader Chuck Schumer (D-N.Y.) have succeeded in negotiating the agreement of Sens. Manchin and Kyrsten Sinema (D-Ariz.), and the passage of the $300 billion deficit reduction, healthcare and climate change package — the Inflation Reduction Act — through the Senate and House. Yesterday, Biden signed the act into law.
Scientists estimate when implemented the act could reduce U.S. greenhouse gas (GHG) emissions by as much as 40 percent — a huge step in the right direction. This is a remarkable achievement. It turns almost certain planetary disaster into a renewed possibility of green sustainable pathways ahead of us. The IRA shifts the planetary paradigm and alters our possibilities and those of our children and grandchildren.
We can rejoice — but briefly — for decades of transformative work lie ahead for policymakers, businesses, investors and all of us as citizens if we are to seize this opportunity. It is time to get going and begin to implement the green contours of our carbon-neutral circular economy of 2030 and beyond.
We have no time to waste. Few today can deny the urgency of action, and those that do should be discounted as fools with their heads buried in the baking sands. California is burning. The homeless of Phoenix, Ariz., are dying of heat stress. Our great Western reservoirs, Lake Mead and Lake Powell shrink and shrink. France and the United Kingdom bake under record scorching temperatures. Every week, research highlights we are already seeing dangerous accelerations and tipping points. The Arctic is warming four times faster than the temperate zone, resulting in fires and a Siberian permafrost melt that is releasing 28 times the amount of GHG previously recorded. Apologies to depress you at this moment of green breakthrough.
So, what is most urgent, important and impactful in Biden’s IRA?
A shift in power generation to renewables: The IRA provides tax credits for wind and solar for producers and consumers. This makes a huge contribution — changing the industrial incentives. The CEO of Vestas, one of the world’s leading wind turbine builders, called the Biden green provisions “a major breakthrough,” while others heralded the IRA as a “gamechanger” for companies like Vestas.
Moving carbon sequestration and capture from demonstration projects to commercial viability: Biden’s IRA provides significant tax credit incentives for the building and operation of these new facilities, which will be essential because all scenarios of a livable tomorrow require huge qualities of GHG to be removed from the atmosphere.
The acceleration of the electric vehicle (EV) transition: The IRA provides $7,500 credits for U.S. newly built EVs ($4,000 for secondhand EVs) for middle-class taxpayers (anyone earning up to $150,000). The EV transition will speed up, supported by an earlier $1.2tr infrastructure bill, which included a raft of climate-related measures that will build out the charging network. Supporting this transition also requires the Biden Administration to lift restrictions on Chinese components that are essential to EV production.
Helping families invest in greener options: The IRA provides tax credits for homeowners to improve their home’s insulation and efficiency and for the installation and retrofit of newer, energy-efficient technologies.
If we take the IRA and the infrastructure bill together, President Biden’s remarkable, unprecedented green achievement will remake large parts of the U.S. economy and create green jobs in wind, solar, EVs, batteries, carbon capture, remediation, retrofitting and redesign across the country. These jobs cannot be outsourced or replaced by an app and they will likely be higher skilled and better paid than many service jobs. This is a green win and will be the economic driver of our future prosperity.
Now we must get on with it and take responsibility for the part we each must pay in taking advantage of the new possibilities Biden’s triumph accords us. Let’s start sourcing our electricity from renewable providers. Plan to buy an EV — put your reservation in soon — you will have some time to wait. Retrofit homes to do planetary good and save money at the same time. As investors, entrepreneurs and employees we should, going forward, make decisions based on what the firms we source from, invest in and work for are doing to help achieve the collective net zero goal. We should support those that are walking the walk and walking away from those who fail to see the epochal shift that has gotten underway.
If we all do our part, we can turn the unfolding climate tragedy into a host of dynamic possibilities for an enduring green future. We may be able to look back years from now and identify the passage of Biden’s IRA as the start of our American green renewal.
Today — for a moment at least — put aside worry and despair and choose hope and opportunity. My goodness, what a difference a month can make.
Stuart P.M. Mackintosh is the executive director of the G30 and author of “Climate Crisis Economics.”