States across the U.S. are off to the races, chasing after an unprecedented prize: billions of dollars in climate, clean energy, and clean transportation investments.
A host of recent federal legislation is already paying dividends. The Inflation Reduction Act is the largest climate package in U.S. history, and the bipartisan Infrastructure Investment and Jobs Act has provided a much-needed funding boost to modernize and upgrade infrastructure. From electric vehicles to battery plants to energy storage and solar panels, this legislation is leveraging tens of billions of dollars in private investment to manufacture and deploy new clean energy technology. As a result, we are seeing thousands of new jobs in red, blue and purple states alike, and across every region of the country.
In the states, this adds up to a major opportunity to capitalize on new grant programs and historic federal tax credits for businesses and consumers shifting to clean energy. Leading governors and lawmakers recognize that, by passing their own ambitious policies that facilitate climate action, they can leverage all those federal dollars to unlock even more private investment in their states.
And this year, nobody has done a better job than Colorado.
The administration of Gov. Jared Polis and the state legislature explicitly set out to maximize the benefits for federal investments for Colorado’s businesses, residents, communities and overall economy. They’ve emerged from an impressive blitz of legislation and policymaking in a much better position to do so.
Deeply aware of the risk that climate change poses to some of its premiere industries, from skiing to brewing, Colorado in 2019 passed a strong climate law, pledging to reduce climate pollution by 90 percent by 2050. But because the Inflation Reduction Act, increasingly ambitious private sector action, and technological advances have all put a 100 percent reduction in play, this year Colorado passed legislation to increase its 2050 ambition to achieving a net zero economy with strong interim targets along the way. The upped ambition sends a strong signal to industry that the state is committed to a clean economy, inviting investment, innovation and solutions to achieve that mission.
And to kickstart that effort, lawmakers also passed a menu of state tax credits to help consumers and companies access clean technology. The package includes incentives to encourage the adoption of heat pumps, e-bikes, electric lawn equipment, and zero-emission cars and trucks — including both passenger vehicles and larger commercial vehicles. Designed to complement or, in some cases, fill in the gaps of the Inflation Reduction Act’s federal tax credit, it provides even more incentive to adopt clean technologies that will ultimately benefit the climate, save consumers money, and grow Colorado’s economy.
The new incentives will add to the already surging demand for electric vehicles. But the Polis administration accounted for that as well by adopting a pair of important clean transportation regulations that will ensure the availability of their vehicles for consumers and companies alike.
The Advanced Clean Trucks rule, adopted earlier this year, will ensure that manufacturers boost production of medium- and heavy-duty vehicles as corporate fleet owners increasingly look to adopt them to save on gas and maintenance costs. Meanwhile, the next phase of the Advanced Clean Cars program, which the state is in the process of adopting, will similarly encourage automakers to bolster electric vehicle sales in the state. Not only do these programs help to address transportation-related climate pollution — the largest source of it in the state —it also signals that the state is prepared to act as a leader in adopting clean vehicles that are rapidly growing in popularity.
And those were just the headliners. The state passed several additional policies as well, including efforts to encourage geothermal heating, to expand electric vehicle charging, and to organize utilities’ planning processes around achieving the state’s clean energy targets — all of which will further complement and build off those federal investments.
The surge of clean energy investment across the nation is living proof of what forward-looking companies and investors have been saying for years: strong public policy to confront the climate crisis and build out the infrastructure to do so is not just an imperative for the good of the planet but a massive economic opportunity.
Still, states that want all that federal and private investment shouldn’t just count on it pouring in. By taking action, Colorado is now ideally situated to attract huge sums of federal and private investment to grow the economy of the future. It’s an alluring position for any state, and Colorado has provided the model to get there.
Alli Gold Roberts is the senior director of state policy at the sustainability nonprofit Ceres.