The new legislation, the Inflation Reduction Act of 2022, contains $369 billion in climate and clean energy funding — proving a name change can go a long way toward getting what you want. That dollar amount is less than what was on the table in various iterations of the Build Back Better Act, but it does spread the money that is there around to multiple facets of the clean tech industry in ways that Build Back Better never did.
There are tax credits for clean energy and storage deployment at the utility scale. That’s a huge boon, given that a recent American Clean Power report found renewable installations plunged 55% in the second quarter compared to the same period last year. A big reason for the dip was Manchin’s opposition to Build Back Better, which created regulatory uncertainty.
Having a framework in place for new tax credits, courtesy of the Inflation Reduction Act, could alleviate some concerns and get the industry back on track. Indeed, Heather Zichal, CEO of the trade group, said in a statement the “entire clean energy industry just breathed an enormous sigh of relief” when the new deal was announced.
There are also tax credits for individuals to install solar panels and heat pumps as well as to buy new and used electric vehicles. The bill also gives tax credits to non-EVs that burn cleaner fuel such as hydrogen, but given that Manchin called extending EV tax credits “ludicrous” just a few months ago, this is still a major climate tech win.
Where things get…
