The Inflation Reduction Act (IRA), signed into U.S. law by President Joe Biden on August 16th, might be the biggest climate investment in history, but it does not look much like the kinds of policies that have been most championed by climate activists and economists. There is no carbon tax, no cap and trade program, no specific emissions targets. Instead, the law combines a slew of incentives like rebates and tax credits aimed to encourage significant growth of the clean energy and electric vehicle sectors.
To understand what is in the IRA, and what exactly its impact could be on reducing national greenhouse gas emissions, we spoke with Dr. Jesse Jenkins, who leads the REPEAT Project at Princeton University. Dr. Jenkins’ team performed an independent climate and economic impact analysis of the IRA, and he walked us through the details of the climate mitigation measures in this package: what decarbonization strategies are being employed, who is most impacted by the measure, and how much emissions reduction will result from the policies of this bill.