2-Year-Old IRA Yields 334 New Clean Energy Projects. Will the November Election Keep the Momentum Going?
In the two years since it was signed into law, the Inflation Reduction Act (IRA) has created 334 major new clean energy projects, including 132 new or expanded electric vehicle (EV) and battery plants, 24 new large-scale wind and solar generation projects across 22 states and 51 new energy storage projects, according to a new report from E2, a group that advocates for policies considered good for the economy and the environment.
Cleaner emitting vehicle projects represented more than a third of all projects announced within the past year, with a total of 45 projects, said the report.
For the microgrid industry, one example of the IRA’s benefits is a $500 million industrial site being developed by a Berkshire Hathaway company. Thanks to the IRA, the BHE Renewables project will create hundreds of good-paying jobs, said Sen. Joe Manchin, independent from West Virginia, at a groundbreaking event in 2023.
The project will “help reinvigorate American manufacturing, all while being powered by a first-of-its-kind microgrid that will provide clean energy to the businesses located on the site,” he said.
In spite of such gains, the November election casts uncertainty over whether the IRA will remain in place in its current form. Republicans have tried more than 40 times to gut it. And Project 2025 – seen as the Republican party’s manifesto – calls for the IRA to be repealed, according to Alexandra Adams, a senior adviser to the NRDC Action Fund.
Ironically, about three-quarters of the investment sparked by the Inflation Reduction Act is being funneled into congressional districts held by Republicans.
“The IRA is the biggest economic revolution this country has seen in generations. We finally, finally, finally decided to do something about climate change,” said Bob Keefe, executive director of E2 during an Aug. 14 press conference about the report.
The role of EVs as mobile microgrids
Mobile microgrids in the form of bidirectional EVs are expected to become an important part of this revolution. During the press conference, Brad Beauchamp, EV product segment leader at Blue Bird – a global provider of school buses – described the benefits of using vehicle-to-grid (V2G) technology to help support the grid as it becomes more strained by electrification.
The company designed its buses to have “additional capabilities” as the industry begins to embrace V2G, he said. Blue Bird has deployed 2,000 electric school buses to date.
The buses’ batteries can serve as energy storage, interconnect to the grid, store solar energy and release it, provide peak shaving during emergencies and could power schools or critical service facilities like hospitals, Beauchamp said.
IRA’s “staggering” investment in EVs
The IRA has been an important force in accelerating deployment of EVs, said the NRDC’s Adams. The IRA incentives are helping boost the cumulative investment in U.S. EVs and batteries to a “staggering $312 billion,” which would surpass the $243 billion on track to flow into the industry in China. “This would make the United States the world leader in electric vehicle and battery investment,” she said.
Solar companies seeing increased number of projects
Solar companies also say they’re benefitting from the IRA.
Lucas Olinyk, president of Harvest Solar, said during the press conference that his company has doubled in size the past year, largely because of the IRA’s extension of tax credits and direct pay provisions along with funding from the U.S. Department of Agriculture (USDA). The IRA’s direct pay provisions create a pathway for cities, nonprofits, tribes and other tax-exempt entities to benefit from incentives that they previously couldn’t use because they don’t pay taxes. And the USDA provides loans and grants for rural clean energy projects.
In addition, Ajulo Othow, founder and CEO of EnerWealth Solutions, which develops community-scale solar and storage projects in rural areas, said during the press conference that the company had developed a total of 2 MW of solar in 2023, and has 25 MW developed to date.
The IRA lets everyday people use clean energy technologies, she said.
“Now we see working families, people in low-income communities and churches now able to take advantage of this technology in ways they were not before the IRA," Othow added.
Given that the IRA has accelerated clean energy investment and projects, it’s critical to ensure the benefits continue to flow, said Adams.
“What’s important now is to build on this progress, not slam it into reverse,” she said.
Industry viewpoint: Harris would continue clean energy gains as president
If Vice President Kamala Harris is elected president, such benefits are expected to continue. But if elected, former President Donald Trump would attempt to repeal the IRA, boost investments in oil and gas and eliminate EV incentives, industry members said.
“Vice President Harris has served for two decades on the front lines of climate and justice leadership. She’s ready to advance these climate and economic gains from day one as president. She’s ready to lead by example abroad and confront the climate crisis with the urgency it demands,” said Adams.
Harris’ running mate, Minnesota Gov. Tim Walz, is known for climate action in Minnesota. Last year, he signed a law that requires all Minnesota power plants to use 100% clean energy by 2040.
Republicans want to repeal the IRA
“[Harris’] Republican opponent, Donald Trump, has said he’ll rip out these gains root and branch, as payback to billionaire oil and gas donors and other big polluters,” Adams said.
Some industry members point out, however, that if Trump tries to repeal the IRA, Congress would need to act. This would require Republicans to gain control of the U.S House and Senate.
“Congress will ultimately determine how far a second Trump administration can go in rolling back some of the initiatives pursued by the Biden-Harris regime,” said government affairs consultancy Cornerstone in a report. Noting that Trump has said he wants to roll back spending in the energy and environment space, Cornerstone said, “the balance of power in Congress will ultimately determine how far he could go to roll back measures.”
Effect of rollback of “Chevron doctrine” on clean energy
The report noted that, if Trump becomes president, Democrats will have to defend some of the energy funding in response to the "near gutting of the Chevron doctrine" by the Supreme Court. That decision created ways to relitigate a number of regulatory initiatives in the energy sector, the Cornerstone report said.
The Brookings Institution, a nonprofit public policy organization, also weighed in on the effects of a Trump presidency in an analysis.
“A second Trump administration would likely succeed in changing key regulations, which the executive branch can accomplish on its own, such as weakening vehicle and appliance efficiency standards and changing the tax and leasing schemes for fossil fuel development on public lands,” said Brookings.
In addition, a Trump administration could weaken the implementation of the IRA, said Brookings. Courts that agree with Trump’s policies could support his efforts to walk back clean energy policies.
If the 334 clean energy projects supported by the IRA are completed, they would create 109,278 new jobs and bring in about $126 billion in private investments, according to the E2 report.
Clean energy industry members hope to see more IRA-spurred projects, investment, environmental benefits and jobs.
“Taking action to mitigate climate change can't wait, and there's no doubt that Vice President Harris will advance policies that ensure we are building new renewable energy facilities as fast as possible to transform our electric grid while protecting consumers' interests,” said Jennifer Spinosi, general counsel and senior vice president of regulatory and compliance at CleanChoice Energy.
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