NEWS The Inflation Reduction Act and CHIPS could kick US climate policy back into action

For the orig­i­nal link, August 8, 2022, click here.


Bt Thor Ben­son, for Pop­u­lar Science

For the past few weeks, cli­mate action in the US appeared to have a bleak out­look. But things are look­ing to change with the pas­sage and intro­duc­tion of two new ground­break­ing bills.

Con­gress passed a bill called the CHIPS and Sci­ence Act on July 28th to boost domes­tic semi­con­duc­tor pro­duc­tion and fund sci­en­tific research. The Sen­ate also just passed an expan­sive bill called the Infla­tion Reduc­tion Act (IRA).

Both bills would do quite a bit to help the US fight cli­mate change—much to the relief of many Democ­rats in Con­gress wor­ried about get­ting cli­mate leg­is­la­tion passed before the midterms. But with so much leg­is­la­tion float­ing around, keep­ing track of each bill’s actions can be tricky.

Here’s what you need to know about cli­mate change poli­cies in the IRA and CHIPS act.

Direct cli­mate action from the Infla­tion Reduc­tion Act

Screen Shot 2022-08-08 at 8.48.34 AM

The Infla­tion Reduc­tion Act includes roughly $369 bil­lion for cli­mate pro­grams, mean­ing, if passed, it could be the most sig­nif­i­cant cli­mate bill Con­gress has ever passed. The bill offers tax incen­tives to com­pa­nies to increase the pro­duc­tion of wind, solar, and bat­tery tech­nolo­gies. Addi­tion­ally, the bill lim­its the amount of methane a US com­pany can emit, which is cru­cial because methane is a potent green­house gas.

As for ordi­nary folks, the bill offers a $7,500 tax credit toward pur­chas­ing a new elec­tric vehi­cle and a $4,000 tax credit toward pur­chas­ing a used one and more. This is impor­tant because elec­tric cars are bet­ter for the cli­mate than gasoline-​​powered vehi­cles. But, it may have the bonus of con­vinc­ing car man­u­fac­tur­ers to keep build­ing more elec­tric vehi­cles and could increase the build­ing of charg­ing stations.

Whether you’re on the EV side, whether you’re on the sta­tion­ary green power side, see­ing them all in the same bill is crit­i­cally impor­tant,” Daniel Kam­men, a pro­fes­sor of energy at the Uni­ver­sity of Cal­i­for­nia, Berke­ley. “It mes­sages that $369 bil­lion is being spent in a holis­tic way.”

report from the Rhodium Group, an inde­pen­dent research firm, found the IRA would reduce green­house gas emis­sions by 31 to 44 per­cent from 2005 lev­els by 2030. Green­house gas emis­sions peaked coun­try­wide in 2005, but since then, car­bon emis­sions have shrunk by 20 per­cent. The Biden admin­is­tra­tion has set a goal of reduc­ing emis­sions by 50 per­cent from 2005 lev­els by 2030—so the IRA would pro­vide a sig­nif­i­cant boost.

Cur­rent pro­jec­tions show the IRA wouldn’t get us to the Biden administration’s cli­mate goals by itself, but Kam­men feels that the effects of it pass­ing could “snow­ball.” He says that the ini­tial invest­ment could spur fur­ther invest­ments and break­throughs to help us reach or exceed planned emis­sion reductions.

The CHIPS bill ups fund­ing in sci­ence and technology

The CHIPS and Sci­ence Act mainly focuses on increas­ing the domes­tic pro­duc­tion of semi­con­duc­tors used in com­put­ers, phones, vehi­cles and more. That being said, the bill con­tains other impor­tant pro­vi­sions. It includes roughly $200 bil­lion of fund­ing for sci­en­tific research, which is a sig­nif­i­cant increase in fund­ing. That money could be crit­i­cal in devel­op­ing new technologies—from arti­fi­cial intel­li­gence to nuclear fusion—and could help the US reach its cli­mate goals. Kam­men says the bill’s fund­ing could be ben­e­fi­cial as the US tries to build more renew­able energy.

The more we think about what has dri­ven the remark­able cost declines in solar, in bat­ter­ies and wind, it’s cer­tainly man­u­fac­tur­ing, but it’s also sys­tems inte­gra­tion,” Kam­men says. “That’s a place where the US is bet­ter poised than it may think it is to be a real leader. Clean energy sys­tems require as much smart inter­con­nec­tion as they do great pieces of indi­vid­ual hardware.”

The fund­ing in the CHIPS bill could help the US fur­ther inte­grate its energy sys­tems, mak­ing for more effec­tive and effi­cient energy use in towns and cities. “Assum­ing we get a ver­sion of the Schumer-​​Manchin IRA bill and [CHIPS], it actu­ally sets the US up pretty well,” Kam­men says, “because you get both upstream, smart inte­gra­tion devel­op­ments and $369 bil­lion of deploy­ment money from tax cred­its, so I think they do work together.”

Together, these two bills work to fund urgently needed change in cli­mate pol­icy, con­sid­er­ing there’s only so much time to do some­thing. The CHIPS bill’s invest­ments could also bring us the next gen­er­a­tion of climate-​​fighting tech­nolo­gies and bet­ter inte­grate our exist­ing and devel­op­ing energy sys­tems. The US looked poised to fail in its attempts to fight cli­mate change, but these bills are cre­at­ing some hope.

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