US President Joe Biden has signed a landmark bill which pledges $369 billion to fight climate change – the most significant commitment ever made on the issue by the US Government.
Its estimated that the Inflation Reduction Act will reduce the country’s greenhouse gas emissions by around 40 percent, getting the US two-thirds of the way to meeting its 2030 goal under the Paris Agreement.
President Biden said: ‘The Inflation Reduction Act invests $369 billion to take the most aggressive action ever in confronting the climate crisis and strengthening our economic, our energy security.’
Analysis by researchers from Climate Action Tracker says the move will reduce future global warming by ‘not a lot, but not insignificantly either.’
Professor Jesse Jenkins, an energy researcher at Princeton University told ABC News that the bill marks ‘the first substantive piece of climate legislation that has made it through the US Senate in history, after decades of inaction.’
It is expected to lower US emissions by up to 44 per cent by 2030, compared with the current trajectory, which would lower emissions by up to 35 per cent in the same time frame.
Of the total costs $161 billion has been set aside to reduce greenhouse gas emissions across the entire US economy including funding states and utility companies transferring to clean energy production, through tax credits, grants and loans.
Financial incentives will also be made available to manufacturing firms which reduce emissions, especially chemical, steel and cement plants.
The package has set aside $60bn for what it calls environmental justice programmes. These will include grants to disadvantaged neighbourhoods across the country who want to connect communities through sustainable infrastructure and transport, as well as those looking to tackle pollution at a local level.
Investing in clean public service vehicles, such as school buses and garbage trucks is being allocated $1billion, with a further $3 billion for ports to become emission free through smart technology.
A further $60bn will go towards clean energy production such as wind turbines and solar panels.
Other investments have been allotted to climate-smart agriculture, fire resistant forestry, natural habitat restoration, electric vehicles, and energy efficient homes.
President Biden said: ‘This bill is the biggest step forward on climate ever — ever — and it’s going to allow — it’s going to allow us to boldly take additional steps toward meeting all of my climate goals — the ones we set out when we ran.
‘It includes ensuring that we create clean energy opportunities in frontline and fence-line communities that have been smothered — smothered by the legacy of pollution, and fight environmental injustice that’s been going on for so long.’
Biden also pointed to advantages to US industry and the country’s population through the bill.
‘American auto companies, along with American labour, are committing their treasure and their talent — billions of dollars in investment — to make electric vehicles and battery and electric charging stations all across America, made in America. All of it made in America,’ said the President.
‘This new law also provides tax credits that’s going to create tens of thousands of good-paying jobs and clean energy manufacturing jobs, solar factories in the Midwest and the South, wind farms across the plains and off our shores, clean hydrogen projects and more — all across America, every part of America.’
‘It’s going to offer working families thousands of dollars in savings by providing them rebates to buy new and efficient appliances, weatherise their homes, get tax credit for purchasing heat pumps and rooftop solar, electric stoves, ovens, dryers.
‘It gives consumers a tax credit to buy electric vehicles or fuel cell vehicles, new or used. And it gives them a credit — a tax credit of up to $7,500 if those vehicles were made in America.’
Other aspects of the overall Inflation Reduction Act include caps on prescription drug costs, lower healthcare premiums, and a minimum of 15 per cent tax on large corporations profits.