In the U.S., an Inflation Reduction Act has been passed. Will this address the impact of global economic pressures and what does it mean for tax credits, climate goals, and energy storage allocations?
U.S. President Joe Biden has signed a $740 billion climate change, healthcare and tax bill into law. While ethe measures are watered down in terms of what Biden originally conceived, they present a series of actions that can slowdown the effects of permanent climate change.
“This bill is the biggest step forward on climate ever,” Biden is quoted by The Guardian. “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.”
Looking into the headlines for Digital Journal is Jana Gerber, Schneider Electric’s President of their Microgrid Line of Business.
According to Gerber, the Act does not impede the necessary steps required towards the achievement of U.S. climate goals. While the climate goals are relatively modest, the measures taken provide some way forwards of facilitating the goals.
Gerber says: “The renewable ambitions of companies and organizations are well within reach for the first time, marking a significant step forward for our nation’s climate goals.”
In particular, Gerber calls out: “The extension of tax credits along with the revamped tax credit system for other technologies and the manufacturing of clean energy equipment will help advance renewable energy deployments, including increased adoption of distributed energy resources like microgrids.”
Another area that helps to ease forward a progressive environmental agenda is electric vehicles. Here Gerber finds: “By removing the manufacturing 200,000-unit cap, this potentially means consumers can accelerate their electrification journey — especially with EVs”
Measures will continue going forwards in a different format, notes Gerber: “After 2025, the current tax regime will be replaced by technology-neutral tax credits based on emissions. Electrification of transportation and embedding microgrids in communities will set the stage for the ‘grid of the future.”
There is more to be done long-term, states Gerber: “Moving toward a diversified power infrastructure leveraging both the power grid and DERs will provide more resilient power in emergency scenarios and support our larger critical infrastructure system.”
Summing up the implications, Gerber adds: “The passage of this bill validates our progress toward more sustainable power and shows that microgrids are moving out of the ‘experimental’ phase. In the near future we will see that they will serve as the standard for a resilient and sustainable power infrastructure.”
