Research released by the renewable energy advocacy organization American Clean Power Association found that the year after the Inflation Reduction Act’s enactment saw more investment in the industry than the previous eight years combined.
Wind, solar, nuclear, carbon capture technologies, and biofuels, as well as electric cars, benefited greatly from the IRA’s generous tax credits for low-carbon and carbon-free energy sources. The influence of these subsidies has been shown in recent studies.
A new analysis from research firm BloombergNEF predicts that wind and solar power will account for nearly half of global power output by 2035 and 64% by 2050. This is a considerable increase from the 12% share they had in 2021.
The Bloomberg analysis predicts that by 2035, 87% of the power system will be powered by energy generated from zero-to-low emission sources, including wind, solar, nuclear, and gas with carbon capture.
The report predicts that by 2030, U.S. greenhouse gas emissions will be 35%-41% lower than in 2005, falling short of the president’s target of a 50% reduction.
It seems the climate legislation is having an effect, as the analysis found that without the IRA and the Bipartisan Infrastructure legislation, emissions would only reach 27% lower than 2005 levels.
The Bloomberg analysis similarly predicts that by 2030, the United States will have emitted 22 percent more than Biden’s target. Biden has said that he would want to attain a net-zero level by mid-century, and this projection indicates that emissions will decrease by around 54% between 2021 and 2050.
On Wednesday, Tom Rowlands-Rees, head of North American analysis at BloombergNEF, told reporters that the IRA’s incentives, or “carrots,” must be matched by “sticks,” or penalties, to encourage sectors to operate climate-friendly.
He said, “We realize it’s tough to dictate things in Washington.” The following step requires it, so it’s still worthwhile to attempt.