Around 80 clean energy factories announced in the year since Biden’s IRA passed.

Around 80 clean energy factories announced in the year since Biden's IRA passed.

America’s Inflation Reduction Act: One Year Later

Solar Panels


One year ago, the United States passed the Inflation Reduction Act (IRA), a climate law aimed at reducing greenhouse gas emissions and promoting clean energy. This groundbreaking legislation has already had a significant impact on the country’s energy landscape, driving investment in renewable energy infrastructure and manufacturing. The IRA has not only brought about positive environmental change but has also created economic opportunities and generated enthusiastic support from consumers.

Financial Incentives Driving Clean Energy Adoption

One of the key drivers behind the widespread adoption of clean energy is the financial incentive provided by the IRA. The law offers a 30% tax credit on clean energy installations, making it more financially attractive for families like Heather Baggett’s in Frankfort to invest in renewable energy sources. Baggett emphasizes that their decision was based on financial considerations rather than political motivations: “For us, it’s not politically motivated. It really came down to financially, it made sense.”

A Massive Clean Energy Buildout

The IRA has spurred a massive buildout of battery and electric vehicle (EV) manufacturing facilities across the United States. The American Clean Power Association reports that nearly 80 major clean energy manufacturing facilities have been announced since the law’s enactment, representing an investment equal to the previous seven years combined. This rapid expansion has been met with excitement from industry experts, with Jesse Jenkins, a professor at Princeton and leader of the REPEAT Project, noting, “It seems like every week there’s a new factory facility somewhere.”

Reducing Carbon Emissions and Reversing Supply Chain Dominance

The IRA represents America’s most significant response to climate change and seeks to bend the arc of U.S. greenhouse gas emissions. By supporting clean energy buildout, the law aims to reduce the carbon footprint of transportation, a major contributor to climate pollution. Siemens, a global tech company, cites the alignment of U.S. policy on climate as a driver of increased demand for EV charging stations. Barbara Humpton, CEO of Siemens USA, highlights the positive effects of federal government investment, stating, “When the federal government makes an investment, we get to the tipping point faster.”

The law also encourages the development of storage technologies, specifically batteries that can supply electricity to the grid during periods of low wind or when solar panels are not receiving sunlight. This focus on storage could propel the storage business on a trajectory similar to the solar industry a decade ago.

Expanding Technologies and Opening Global Market Opportunities

The IRA not only supports established renewable energy sectors but also promotes the growth of technologies that show promise in decarbonization efforts. One such technology is electrolyzers, which split hydrogen from water to produce clean energy. Jason Mortimer, senior vice president of global sales at EH2, explains that the IRA has accelerated the implementation of hydrogen at scale, making the U.S. competitive with Europe in this emerging sector.

Closer Look at Impact and Potential Challenges

While the monumental changes brought about by the IRA are already evident, experts suggest that this is just the beginning. The true impact of the law will be felt between 2026 and 2028, when wind and solar-related manufacturing investments are expected to flood the U.S. market.

However, the United States is not alone in its efforts to transition to clean energy. Other countries, such as Canada and European nations, have enacted their own measures to attract manufacturing and accelerate the clean energy transition. This global competitiveness underscores the importance of continued innovation and investment in the renewable energy sector.

The Cost and Future Targets

The IRA’s tax credits were initially estimated to cost approximately $270 billion over a decade. However, businesses may take advantage of the credits more aggressively, potentially resulting in the federal government paying out three or four times more than anticipated. Despite the costs, the law is expected to reduce U.S. greenhouse gas emissions by as much as 41% by 2030, marking a significant step toward achieving climate goals.

Challenges and Diverse Perspectives

While the IRA has garnered widespread support, it also faces challenges and opposition. Recently, some Republicans proposed repealing major elements of the law, highlighting the ongoing debates surrounding climate policies. Additionally, not all consumers are enthusiastic about the transition to clean energy. Jessie Decker, a resident in Frankfort, expresses skepticism about federal investment in climate programs, emphasizing that such programs may not be worth the taxpayer money.

A Balanced Approach to Clean Energy Adoption

Despite ongoing reliance on fossil fuels, the IRA has paved the way for individuals and communities to embrace renewable energy. Nickolas Hartnett, owner of Pure Power Solar, is delighted with the surge in business as homeowners recognize the financial benefits of solar energy. Hartnett notes that the IRA provides both environmental and financial incentives, offering a win-win situation for those concerned about climate change and taxpayers alike.


As the U.S. marks the one-year anniversary of the Inflation Reduction Act, it is evident that the legislation has spurred widespread clean energy adoption and manufacturing investment. By providing financial incentives, promoting technological advancements, and increasing demand for clean energy solutions, the IRA has significantly influenced the country’s energy landscape. While challenges remain, the law has set the stage for greater clean energy manufacturing capacity, reduced carbon emissions, and a path toward a more sustainable future.