Last week, people everywhere rejoiced at the imminent passage of the $369 billion federal climate bill – the Inflation Reduction Act – which experts say is the largest single piece of climate legislation in U.S. history.
The bill is not insignificant. That’s a lot of money. And it could mean serious investments for the producers and serious cost savings for the consumers of electric vehicles (EVs), solar panels, heat pumps and other renewable technologies that are necessary to replace fossil fuels.
And as Peter Kalmus, a NASA climate scientist, has observed, the bill pays for this stuff by taxing corporations and the wealthy (critically, the bill will allocate more money to the IRS to enforce these tax measures). The bill also rightly enacts a fee on methane leaks over federal limits, although Kalmus notes that both the limits and the means of enforcement are unclear.
But in a way, the bill is also vastly inadequate and potentially harmful, as Branko Marcetic explains in a recent Jacobin article.
“The most alarming problem is the bill’s mandating what is in effect a decade-long carbon bomb through oil and gas leases,” he writes. “If passed, any new wind or solar projects on public lands or waters would have to first offer, respectively, at least 2 million acres and 60 million acres of each for oil and gas leases — and that’s every year, for an entire decade.”
Brett Hartl, the governmental affairs director at the Center for Biological Diversity, told Marcetic that the bill is “a climate suicide pact,” particularly in light of a recent Associated Press investigation that revealed “that hundreds of lease sites in the Permian Basin alone are every hour leaking between hundreds and thousands of kilograms worth of methane, a greenhouse gas dozens of times more planet-boiling than carbon dioxide.”
Last year, Fatih Birol, the executive director of the International Energy Agency (IEA), arguably the world’s foremost authority on the global energy sector, was unequivocal in her assessment of the climate situation.
“If governments are serious about the climate crisis, there can be no new investments in oil, gas and coal, from now – from this year,” she said.
Not only will this bill potentially expand drilling and extracting among private oil and gas corporations, it doesn’t do much of anything to address the carbon emissions squarely within the federal government’s purview.
Kalmus helpfully contrasts the $369 billion in the Inflation Reduction Act, spent over 10 years and through a litany of tax credits, with the annual U.S. military budget, which is about $800 billion a year (and that’s in cash, not credits).
The $36.9 billion a year coming from this climate bill is about 5 percent of the annual spending by the U.S. military, which is arguably the largest institutional emitter of carbon on the planet.
There is a lot in this bill that preserves the status quo driving us headlong into environmental and geopolitical catastrophe. It offers piecemeal reforms when we need the federal government to exercise its might on the public’s behalf and punish fossil fuel companies both for lying about global warming for decades and for continuing to emit despite knowing the dangers.
More than vague fines, we need serious regulations designed to stop carbon emissions now. More than tax credits that are largely invisible to the average person, we need direct investment (and possibly public production) of renewable energy sources like wind and solar on a scale and with an intensity similar to the country’s mobilization during WWII.
This is a tepid bill relative to our currently dire straits and, despite the PR packaged praise in the mainstream press, it does not change the underlying factors that are causing the current climate malaise. We are still an overly militarized, corporate-run, heavily privatized, heavily car-dependent, sprawling, aging, growth-obsessed and increasingly impoverished, but imperious country that refuses to live within her ecological and social limits.
With that said, we can’t just gloss over the myriad ways that the climate bill can also lead to very real, material improvements in actual people’s lives.
The tax credits for products like heat pump water heaters, solar panels and home energy audits could save the average homeowner thousands of dollars.
The bill also expands the number of new EV sales that can benefit from the $7,500 tax incentive and extends the number of years the incentive is on the books, from a few to 10.
Currently, roughly 5 percent of the vehicles sold in the United States are EVs, according to Cox Automotive. A collective push among municipalities to electrify their fleets could drive that number up and relatively quickly.
The hard part is that, in order for EVs to qualify for the tax credits, “their batteries will need to contain minerals extracted from or processed in a country the US has a free trade agreement with, and a portion of components to be manufactured or assembled in North America,” Bloomberg reports. And that’s far from a given, considering that many North American factories “are still being planned and constructed.”
Locally, municipalities and homeowners have time to prepare for the windfall if and when the production of EVs ramps up. More importantly, though, the proposed climate bill comes as suburbs in our area are positioning themselves to transition from fossil fuels to renewables, and from auto-centric to human-oriented.
For instance, Oak Park could leverage the federal tax credits, once they become available, to expand its existing network of EV charging stations and to realize its goal of decarbonizing vehicles and buildings in the village outlined in its comprehensive Climate Ready Oak Park plan.
That plan could very well be a national model for how suburbs can go about positioning themselves for securing a portion of the Inflation Reduction Act’s $369 billion. In its plan, Oak Park has inventoried its greenhouse gas emissions, tabulated its climate hazards and created vulnerability indices that center racial and income equity.
The Oak Park plan also provides a concrete, prioritized timeline for delivering on real climate-related goals. Importantly, unlike the federal climate bill, the village’s plan prioritizes public transit and non-automotive forms of transportation like biking and walking. In other words, it considers how we can change our fossil fuel culture and the built environment underlying it.
This climate bill also comes at what I think is a critical moment of institutional collaboration on the Greater West Side, particularly around issues of racial and economic equity.
In June, mayors from roughly a dozen west suburbs signed onto the Cross-Community Climate Collaborative (C4), which would allow officials in area suburbs to regularly convene and share best practices and resources for how to transition their communities from fossil fuel culture.
This Collaborative will be particularly critical for area municipalities that don’t necessarily have the resources and personnel to create a plan like Oak Park’s.
For instance, the federal climate plan could allocate about $3 billion in grants for communities that have been “cleaved apart by highways and other infrastructure,” according to Route Fifty, a government news publication.
“The new money could be used for a variety of purposes, including covering a highway, turning a highway into a boulevard, adding trails and bike lanes, installing sound barriers, providing better connections to transit, using ‘green infrastructure’ to handle storm runoff, reducing urban heat island hot spots, building safety features and curbing air pollution,” Route Fifty reports.
About $1.1 billion of that grant money would be directed to “economically disadvantaged communities,” but in order to even qualify for the funding, those communities “must have ‘an anti-displacement policy, a community land trust or a community advisory board in effect,’ as well as a plan to employ local residents in making the improvements.”
That’s quite a lot to ask of relatively small suburbs like Bellwood or Maywood that are juggling a million other things. C4 and even institutions like the Oak Park-River Forest Community Foundation can provide critical assistance to these smaller, low-income municipalities. For instance, the Community Foundation recently released an equity report that has vital information west suburbs can use when applying for federal grant funding whenever it comes online.
Overall, we need to shout from the potentially solar-paneled rooftops about the existential harm that this bill allows by letting fossil fuel polluters off the hook while praising the bill’s good provisions and preparing ourselves to take advantage of them.