Inflation Reduction Act Promotes Renewable Energy, Looks to Drastically Cut Emissions

The Inflation Reduction Act passed the House this past week becoming the country’s most ambitious energy and climate policy to date.

The legislation paves the way for more clean energy, updated building codes, billions of dollars for communities in need of climate change help as well as providing an array of tax incentives to push climate-friendly technologies.

The legislation passed the Senate on Aug. 7, 2022, and proceeded to pass the House by party-line vote (220-207) on Aug. 12, 2022. President Joe Biden says he will sign the legislation into law. Once signed, it will be the most sweeping climate act to be passed in U.S. history.

The pillar of the legislation is $375 billion over 10 years to promote consumers and industry to shift from carbon-emitting to cleaner forms of energy. Loans and tax credits will also help bolster technology such as solar panels and consumer efforts to improve home energy efficiency.

The main climate change provisions include large investments in clean energy. This includes $369 billion for electric vehicles and clean energy tax breaks. This will help establish clean energy as a cost-effective option for many Americans. The tax credits are designed to pivot the industry and consumers to renewable energy systems, such as heat pumps, electric appliances and other technologies such as dynamic glass (the Dynamic Glass Act specifies that the use of electrochromic glass qualifies for the tax credit for investment in energy property).

The legislation also provides $330 million in grants to states and local governments to adopt the latest energy codes that meet or exceed the 2021 International Energy Conservation Code (IECC) and/or ASHRAE 90.1-2019. Additionally, it provides $670 million for states and localities to adopt and implement zero-energy stretch codes.

More than $250 million will be provided for General Services Administration (GSA) facility retrofits and $2.15 billion for the Federal Buildings Fund. This money will be used by the GSA to acquire and install low-embodied carbon materials and products for use in the construction or alteration of buildings. The legislation also includes $975 million for GSA to invest in emerging and sustainable technologies.

Additionally, more than $7 billion in competitive grants will be distributed to enable low-income and disadvantaged communities to deploy and benefit from zero-emission technologies. This includes distributing technologies on rooftops and carrying out other greenhouse gas emission reduction activities.

The Inflation Reduction Act should help the U.S. reduce emissions by about 40% below 2005 levels by 2030, according to officials. This comes after President Biden set a goal of reducing greenhouse gas emissions in the country by at least 50% by the decade’s end.

The American Institute of Architects (AIA) applauded the passage, especially the legislation’s focus on provisions for building codes, climate tax incentives and affordable housing.

“I am proud of the work AIA has done to get Congress to include language addressing our legislative priorities,” says AIA EVP/CEO Lakisha Ann Woods, CAE. “AIA’s sustained commitment to advocating for legislation addressing greenhouse gas emissions from the built environment as well as resilient and affordable communities is evident throughout this bill. Though the climate crisis still requires our unrelenting attention, this legislation is a step in the right direction.”