According to Credit Suisse, a significant impact will be made by the Inflation Reduction Act on renewable energy. The US may notice the Levelized price of electricity from renewable sources decline to less than 1 cent per kWh hour by 2025- after factoring in all charge and production credits. Now, before we get all crazy over this news, a couple of essential caveats are in order.
First, according to Bloomberg News (paywall), Credit Suisse has recently faced issues, including a potential criminal inquiry in America and a US Congress investigation. In addition, no one has actually supplied a link to the Credit Suisse research, even though you can locate this news on Twitter and The Atlantic has taken it up. Your meticulous Google search ultimately came up empty-handed. But Robinson Meyer of The Atlantic appears to have read that, and what he has to say is listed below.
At the end of last month, a research note was released by the analysts at the investment bank about America’s new climate law that went almost neglected. Over which the bank argued that the Inflation Reduction Act is more significant than has been recognized so far. The bank said that the IRA will have a profound impact on industries in the decade and beyond and could ultimately structure the direction of the American economy. The report exhibits how despite the bonanza of climate-bill coverage earlier this year, we’re rarely able to comprehend how the law works and what effects it may have on the economy.
The report brought about a few broad points in specific that are worth attending to.
Firstly, the IRA will spend twice as much as Congress believes. This is because most of IRA’s considerably essential provisions, such as its incentives for electric automobiles and zero-carbon electricity, are ‘uncapped’ tax credits. That means the government will award them if you match their terms. Moreover, no budget or spending cap is written into the law that governs how much the government can spend. So the widely reported number that the IRA will spend to combat the climate change — $374 billion — is primarily defined by the Congressional Budget Office’s projection of how much those tax credits will be utilized.
Credit Suisse had one additional idea: what may occur if reactionaries and advocates of fossil fuels take over the White House or Congress. They claim that because “Republican-leaning states are projected to receive the largest investment, job, and economic gains from the IRA,” there is less probability of its repeal. Given that people frequently vote against their own best interests, this argument may seem flimsy.
The energy infrastructure of the USA is impeding IRA progress. According to Credit Suisse, influential industry organizations are already pushing for changes to the IRA’s most transmission-friendly provisions.
The Bottom Line
We have witnessed a tipping point in human history. A giant nuclear reactor in the sky is present, supposedly supplying all the energy required by the Earth. Only harvesting remains to be done. The energy we receive from the sun gives rise to even the winds. Few of them, nevertheless, hold the valid viewpoint that the US should refrain from directing the rest of the world’s policies.
In countries ruled by tyrants like Russia, China, and Saudi Arabia, the Inflation Reduction Act is legit to have knock-on effects that will reverberate around these countries. Supposedly if you are against the renewable energy idea, it doesn’t matter. The remainder are content to watch such nations’ influence wane as the need for fossil fuels declines. There is no going back after commencing the clean energy revolution.
Jonas Muthoni is an entrepreneur and renewable energy expert. He is the founder of MicroGridMedia.com, a website dedicated to bringing the latest news and information about solar energy and other renewable energy sources to the public. Jonas is passionate about promoting sustainable energy solutions and educating the public about the benefits of renewable energy. He is a regular speaker at industry events and conferences and is committed to driving the transition to a cleaner and more sustainable energy future.