Regulators

Senate Unveils Legislation Addressing Energy Initiatives

Published on: 30 July 2022 10:15 AM
by KnowESG
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New legislation to cut emissions and improve energy programmes, especially through incentives and increased manufacturing, is being introduced in the United States Senate.

The bill, called the Inflation Reduction Act of 2022, includes $369.75 billion in energy and climate programmes over the next 10 years. Part of its goal is to reduce emissions by 40% by 2030.

The legislation includes tax incentives estimated to reach $30 billion to increase domestic production of renewable energy, including solar panels, wind turbines, and batteries. It also offers incentives for manufacturing plants to build those materials as well as electric vehicles.

While the financial numbers of the bill do not match the Build Back Better legislation, it includes many of the same objectives. It is being supported by Senate Majority Leader Chuck Schumer and West Virginia Sen. Joe Manchin, who opposed Build Back Better. That bill included $555 billion toward energy and sustainability initiatives and passed the US House in November 2021 but didn’t move past the Senate after Manchin declined to support it.

According to NPR, Schumer and Manchin have an agreement with House Speaker Nancy Pelosi and President Biden to pass a bill by the end of 2022 to increase US energy production and supply. If passed, the bill would include the most resources for energy and sustainability programmes on record for the US.

Other elements of the proposed bill include $10 billion in tax credits to increase clean energy manufacturing and $500 million in the Defence Production Act to produce heat pumps and critical minerals. Another $2 billion in grants is designed to retool existing automotive manufacturing plants and up to $20 billion in loans for new facilities to build electric vehicles. There is also money to create clean manufacturing plants in industries such as steel, cement, and chemicals.

The bill calls for grants that increase clean fuel and commercial fleets and $1 billion for heavy-duty vehicles such as school buses and garbage trucks. Port emissions are targeted, as well, to implement zero-emissions equipment and technology.

The legislation encourages sustainable agriculture practices and incentives to build infrastructure for the domestic production of biofuels, including sustainable aviation fuel.

Other items in the bill include a methane reduction programme, money for energy research, and support for environmental justice. Additionally, there are provisions for community projects and increasing renewable energy for disadvantaged areas.

The overall legislation totals $739 billion and also includes programmes for healthcare, deficit reduction, and new tax rules.

Source: Environmental Leader

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