Critical Impact:

The IRA Is Helping Farmers Lead An Agricultural Clean Energy Revolution

America’s farmers are on the front lines of the climate crisis. Shifting seasons and extreme weather events like heat waves, droughts, and flooding are impacting farmers’ bottom line. But thanks to the IRA, farmers now have a huge opportunity to cut costs and pollution by deploying clean energy. The IRA provided billions of dollars of new funding for the Rural Energy for America Program (REAP), and raised the ceiling for funding new clean energy projects, lowered the barrier for installing new clean energy projects like cost-saving solar panels, and made the benefits of clean energy more accessible for farmers, ranchers, and small business owners. Additionally, the IRA invests further in critical USDA programs that assist and protect U.S. farms and farmers, while also providing investments that ensure conservation of vital American farming lands. We’re already seeing the IRA make an impact in farming communities—from the Northeast to middle America, and we know it’s just getting started.

Our take on the latest developments in the IRA’s real-world impact: 

“Farmers and ranchers are critical to America’s fight against climate change, and the IRA equips them with vital resources they need to lead the charge,” said Evergreen Action Deputy Press Secretary Elizabeth Cavalieri. “As climate impacts like extreme weather events threaten rural economies, the IRA is helping communities fight back using clean energy to reduce climate pollution and combat rising energy costs. Rural America is ready to step into a new era that prioritizes climate and clean energy. And the IRA is making that transition a reality.”

Additional Impact:

Biden’s green manufacturing push is bearing fruit | The Washington Post | Jeanne Whalen & Aaron Gregg | 2.24.23

Investment in U.S. factories grew from roughly $70 billion at the end of 2020 to roughly $105 billion at the end of 2022, according to the Bureau of Economic Analysis. And investment in industrial equipment grew from $250 billion at the end of 2020 to around $320 billion at the end of last year. “There is growth and expansion and certainly there should be an expectation that this will get stronger over the next couple of years as the incentives kick in, as we go from announcement of plans to steel in the ground and new production equipment under the roof,” Setser said. In comments to the German newspaper Frankfurter Allgemeine Zeitung published Friday and confirmed by the company, Markus Duesmann, chief executive of Volkswagen-owned Audi, said EV subsidies provided by the IRA made the prospect of a U.S. factory “much more attractive.”

How Inflation Reduction Act is turbocharging clean energy future for Nevada, US | Reno Gazette Journal | Camden Lang | 2.17.23 

As one of the more than 32,000 workers already employed in Nevada’s surging clean energy industry, I’m also pleased that the new law enables workers to benefit from the clean energy economy we’re helping build. More than $270 billion in tax incentives (of the bill’s $369 billion clean energy investment) are tied to labor standards that will boost working conditions for those in clean energy jobs…The Inflation Reduction Act could not have come at a better time. Already it’s fueled a massive clean energy hiring boom, driven innovation as we’ve never seen before, and sped up our transition to a clean energy economy. The most exciting part — our acceleration is just getting started. 

In a first, N.Y. nuclear plant produces carbon-free hydrogen | E&E | David Iaconangelo | 3.13.23 

The Nine Mile Point nuclear plant in New York began producing hydrogen last week, marking a first for the U.S. and casting light on a little-known method for producing carbon-free fuel…When Congress created an $8 billion pot of funds to launch regional hubs of decarbonized hydrogen — as part of the 2021 bipartisan infrastructure law — it required at least one of the hubs to involve nuclear power. And the Inflation Reduction Act offers lucrative tax credits for making clean hydrogen. Kathryn Huff, DOE's assistant secretary for nuclear energy, said the infrastructure law and Inflation Reduction Act would "even further expand the hydrogen market to create new economic and environmental benefits for nuclear energy.”

“This accomplishment [at Nine Mile Point] tangibly demonstrates that our nation’s existing reactor fleet can produce clean hydrogen today,” she said in a statement.

US announces $6 bln in grants to decarbonize heavy industry | Reuters | Timothy Gardner | 3.8.23

The Biden administration said on Wednesday it is directing $6 billion in funding to speed decarbonization projects in energy-hungry industries like steel, aluminum and cement making that contribute nearly 25% of U.S. greenhouse gas emissions. The Industrial Demonstrations Program will provide competitive grants to technology developers, industry, universities and others for up to 50% of the cost of projects that aim to cut emissions from industry that also includes production of chemicals, ceramics and paper, the Department of Energy (DOE) said…The funding comes from the infrastructure bill President Joe Biden signed in 2021, and the Inflation Reduction Act, he signed last year. Environmental groups praised the program and urged DOE to allocate at least 40% of the resources to facilities near communities that face environmental and social impacts from heavy industry. "This new funding is an unmissable opportunity to modernize American primary steel manufacturing, reduce climate and health harming pollution and create jobs," said Hilary Lewis, steel director at Industrious Labs, a nonprofit working on the energy transition. "Without investment today, the industry risks falling behind in the race to green steel." 

Energy storage made record gains in the US in 2022: Sustainable Energy in America Factbook | Utility Dive | Stephen Singer | 3.7.23

The U.S. “made important strides” toward becoming a hub for battery manufacturing in 2022, the Factbook said. After the Inflation Reduction Act introduced a $45/kWh cell and module production tax credit, automakers and battery manufacturers have “raced to identify investment opportunities,” the Factbook said. Post-IRA commitments to the North American battery supply chain reached almost $17 billion by the end of 2022, according to the Factbook. The IRA is expected to spur additional storage deployments. The law includes direct benefits to stationary storage deployments through a standalone investment tax credit and indirect benefits to energy storage with additional incentives for wind and solar and through battery production tax credits.

Carmakers Can Kiss Pre-Pandemic Combustion Car Sales Goodbye | Bloomberg | Colin McKerracher | 3.9.23

At the 2017 peak, 86 million internal combustion passenger vehicles were sold, including traditional hybrids like the Toyota Prius. Battery-electric and plug-in hybrid models were a tiny sliver of the market that year, accounting for just over 1 million vehicles combined. The picture was quite different in 2022. Combustion vehicle sales were down almost 20% from the peak, to 69 million, and plug-in vehicles jumped to 10.4 million. Even if we add plug-in hybrids to the internal combustion column, the picture doesn’t change much. The market still would have peaked in 2017, and global sales in 2022 would be 72 million, still 16% off the high from five years earlier. The trend in China is even more pronounced. Plug-in vehicles made up 26% of vehicle sales in 2022, while combustion models were 28% off the 2017 peak. BNEF is expecting plug-in models to be around a third of all passenger vehicles sold there this year. The story is similar in Europe, with internal combustion vehicle sales down significantly from their peak. In the US, EV sales are poised for a breakout year with support from the Inflation Reduction Act. 

Maryland bill aims to expand commitment to offshore wind | AP | Brian Witte | 3.7.23

A coalition of environmentalists, labor unions, civil rights and consumer groups gathered Tuesday to support a measure to expand Maryland’s commitment to offshore wind as part of the state’s efforts to address climate change. The bill aims to modernize the electricity grid to transmit offshore wind energy from the ocean to land. Lawmakers hope the legislation will enable the state to benefit in part from nearly $370 billion set aside in the federal Inflation Reduction Act over 10 years to incentivize electric vehicles and jump-start renewable energy such as solar and wind power nationwide. 

North America’s first battery-grade recycling hub just scored a $375M loan | Electrek | Michelle Lewis | 2.27.23

The DOE’s Loan Programs Office  (LPO) today announced a conditional commitment to lithium-ion battery recycling company Li-Cycle for a $375 million loan to help construct North America’s first commercial lithium-ion battery resource recovery facility in Rochester, New York…At peak construction, the Rochester Hub is expected to create more than 1,000 construction jobs, and once it’s fully online, it will support around 270 permanent operations jobs. Li-Cycle expects construction of its Rochester factory to be complete this year.The Biden administration’s Inflation Reduction Act has triggered a surge in companies opening clean energy manufacturing facilities in the US. Senator Chuck Schumer (D-NY) said today:

“This DOE investment in Li-Cycle will reduce our reliance on China and strengthen America’s battery supply chain. And once the facility is at full steam, it is projected to be the biggest source of lithium carbonate in the United States.” 

Biden’s green manufacturing push is bearing fruit | The Washington Post | Jeanne Whalen & Aaron Gregg | 2.24.23

Investment in U.S. factories grew from roughly $70 billion at the end of 2020 to roughly $105 billion at the end of 2022, according to the Bureau of Economic Analysis. And investment in industrial equipment grew from $250 billion at the end of 2020 to around $320 billion at the end of last year. “There is growth and expansion and certainly there should be an expectation that this will get stronger over the next couple of years as the incentives kick in, as we go from announcement of plans to steel in the ground and new production equipment under the roof,” Setser said. In comments to the German newspaper Frankfurter Allgemeine Zeitung published Friday and confirmed by the company, Markus Duesmann, chief executive of Volkswagen-owned Audi, said EV subsidies provided by the IRA made the prospect of a U.S. factory “much more attractive.”

Interested in chatting with our team more about what these impacts mean for climate and clean energy? Reach out to us at elizabeth@evergreenaction.com.