US climate law is already turbocharging clean energy technology

Law Review

On a recent day under the July sun, three men heaved solar panels onto the roof of a roomy, two-story house near the banks of the Kentucky River, a few miles upstream from the state capitol where lawmakers have promoted coal for more than a century.

The U.S. climate law that passed one year ago offers a 30% discount off this installation via a tax credit, and that’s helping push clean energy even into places where coal still provides cheap electricity. For Heather Baggett’s family in Frankfort, it was a good deal.

“For us, it’s not politically motivated,” said Baggett. “It really came down to financially, it made sense.”

On August 16, after the hottest June ever recorded and a scorching July, America’s long-sought response to climate change, the Inflation Reduction Act, turns one year old. In less than a year it has prompted investment in a massive buildout of battery and EV manufacturing across the states.

Nearly 80 major clean energy manufacturing facilities have been announced, an investment equal to the previous seven years combined, according to the American Clean Power Association.

“It seems like every week there’s a new factory facility somewhere” being announced, said Jesse Jenkins, a professor at Princeton and leader of the REPEAT Project which has been deeply involved in analysis of the law.

The IRA is America’s most significant response to climate change, after decades of lobbying by oil, gas and coal interests stalled action, while carbon emissions climbed, creating a hotter, more dangerous world. It is designed to spur clean energy buildout on a scale that will bend the arc of U.S. greenhouse gas emissions. It also aims to build domestic supply chains to reverse China’s and other nations’ early domination of this vital sector.

One target of the law is cleaner transportation, the largest source of climate pollution for the U.S. Siemens, one of the biggest tech companies in the world, produces charging stations for EVs. Executives say this alignment of U.S. policy on climate is driving higher demand for batteries.

“We’ve been talking about bringing manufacturing jobs back to America for my entire life. We’re finally doing it, right? That’s pretty exciting,” he said.

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