On Friday, August 12, the Inflation Reduction Act (H.R. 5376, IRA) passed the U.S. House of Representatives, the final stop in the legislative process before it arrives at President Biden’s desk for his signature. With over $396 billion in direct federal investments in advanced energy, transportation, and manufacturing, the IRA represents the largest climate and clean energy bill in US history – as well as one of the largest pieces of industrial policy in the modern era.
AEE’s Advanced Energy Manufacturing and Infrastructure (AEMI) Working Group dug into the details of the IRA and produced this detailed synopsis, cross-referencing it with other publicly available summaries to ensure accuracy. Many thanks to the team at Wilson Sonsini Goodrich & Rosati, which provided a careful review and additional analysis.
This synopsis is intended to provide a detailed yet succinct synopsis of the IRA’s energy-related provisions. We have provided links to additional summary documents, as well as the full legislative text, at the end of this document.
In addition to our legislative analysis, AEE also produced a preliminary analysis of the economic impact that the IRA and last year’s bipartisan infrastructure law (the Infrastructure Investment and Jobs Act, IIJA) should have upon the U.S. economy in the years ahead. The IRA, in particular, utilizes public financing, in the form of tax credits, grants, and loan guarantees (such as those provided by the Loan Programs Office at DOE) to leverage additional private capital investment. According to our analysis, the advanced energy and transportation investments in the IRA and IIJA will deliver:
$2.8 trillion in total economic activity to the U.S. economy (a six-fold return on investment)
23 million jobs (measured in "job-years")
$60 billion in annual energy savings for consumers
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