The IRA is a landmark piece of legislation designed to reduce inflation, scale low-emissions technologies, drive US-based innovation and create jobs as part of a greener, more sustainable national economy. It includes a number of provisions to accelerate the energy transition and reduce the US’ sizable climate footprint by the end of the decade. Out of the US$500bn in new spending promised by the IRA, the majority (nearly US$400bn) of federal funding will be directed towards clean-energy development, electrification and electric vehicles, delivered in the form of tax incentives, grants and loans, with specific incentives to reduce methane emissions. The IRA complements and expands on the Bipartisan Infrastructure Law (BIL) and CHIPS and Science Acts, which also channel funding into clean-energy development, tech and manufacturing.

Want to know more about how the US aims to meet its 2030 climate target? Don’t miss the following Sustainability Week US virtual sessions: 

  • Fireside chat: Bridging the gap—achieving strong federal climate standards for a 50-52% reduction in carbon emissions by 2030, 3:30pm EDT, June 1st

  • Panel: Scaling renewables at pace, 3:50pm EDT, June 1st

According to Climate Action Tracker (CAT), an independent scientific project monitoring government climate action and measuring it against Paris agreement goals, the IRA is a significant step forward for American climate action, but will not be enough to keep the country on track to reach its near-term national target of cutting emissions by 50-52% below 2005 levels by 2030. 

“The Inflation Reduction Act is a milestone, one of the most stringent climate laws in the US ever,” says Professor Niklas Höhne of the NewClimate Institute, one of the organisations behind CAT. “However, even if it is fully implemented it will not be sufficient to reduce greenhouse-gas (GHG) emissions to the level necessary to meet the national target for 2030.” The Biden administration agrees, admitting the policy will slash emissions up to 40% by the end of the decade.

Mr Höhne believes that additional measures beyond financial support will be needed to reduce emissions further and meet the near-term climate goal, highlighting compulsory mandates, carbon pricing and other regulations.

Want to know more about tax incentives and carbon pricing? Don’t miss the following Sustainability Week US virtual sessions: 

  • Panel: Tax incentives 101—unpacking the benefits and understanding the challenges, 10:40am EDT, May 30th

  • Fireside chat: Carbon pricing—the state of American and international carbon markets, 11:50am EDT, May 30th

While the IRA may not be enough on its own to meet the US’ 2030 climate goal, it also includes environmental considerations that go beyond betting on clean-energy technology, specifically in the realm of agriculture, forestry and conservation.

Want to know more about securing the future of forests in the US? Don’t miss the following Sustainability Week US virtual sessions: 

  • Panel: Forestry at the frontier—how can companies and Indigenous communities secure the future of forests? 10:15am EDT, June 1st

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