Advanced Energy Perspectives

On Tuesday, President Biden signed the Inflation Reduction Act (IRA), the most significant legislation ever enacted to advance clean energy, electrify transportation, and combat climate change. That much has been well established. What’s been underappreciated is just how transformational the IRA could be. Akin to the industrial policies of earlier eras, it has the potential to reshape the U.S. economy. Employing tax incentives, grants, loans, and innovative financial tools, the IRA, when combined with the Infrastructure Investment and Jobs Act passed last year, will leverage billions in public capital to catalyze trillions in private investment and total economic impact. In so doing, it is poised to rapidly expand domestic markets for advanced energy and transportation technologies, revitalize American manufacturing, and reshape how we produce and use electricity. In other words, as industrial policy for an advanced energy economy, the whole of IRA is greater than the sum of its parts.

On June 6, in response to skyrocketing oil and natural gas prices – an effect of Russia’s invasion of Ukraine – President Biden took a pair of bold steps to kickstart U.S. production of secure, clean, reliable, affordable energy. Now the Administration and Congress need to follow through, ensuring the government’s deeds live up to the President’s words, and the near-term boost leads to permanent production capacity and manufacturing jobs.

As policymakers, industry, and advocates lean into the challenge of decarbonizing the economy, hydrogen has for some become the New New Thing, an energy source that gives off no harmful emissions and is not dependent on the weather. As with many technologies that experience a surge in interest, there is both excitement and skepticism about hydrogen as a clean energy source, prompting AEE to ask: What is the appropriate role of hydrogen in an advanced energy economy? What should policymakers be considering when hydrogen is proposed as a solution for reaching a 100% clean energy future? We don’t have all the answers to these questions, but we do have a set of principles for approaching them.

As Russia’s brutal invasion of Ukraine drags on, it’s important to realize the role our energy choices are playing in the conflict. Our nation’s addiction to oil is financing violent autocrats, like Vladimir Putin, giving them the resources to wage wars abroad and oppress citizens at home. Congress and the White House have reacted by sanctioning Russia’s economy and banning fossil fuel imports from Russia to eliminate America as one of their customers, but it does not put Putin out of business. The best way for America to bankrupt Putin and other petro-dictators is by slashing oil demand here and around the world.

An historic investment of $7.5 billion in federal funds for EV charging is on its way, headed for the states. This federal funding, from the Infrastructure Investment and Jobs Act (IIJA) passed by Congress and signed into law in November, will make it easier for state and local policymakers across America to accelerate the electric transportation transition and meet emissions reductions goals they have set for themselves. It will also pave the way for further growth of the more than 15,000 EV-related businesses in the U.S., with tens of thousands of Americans relying on the electric transportation industry for their livelihood. The time is now for states to set themselves up to make the most of this opportunity.