Citizens’ Climate University: The Climate Benefits in the Inflation Reduction Act of 2022
 Peter Joseph |
Dana’s presentation last night said it all, but here’s a compilation of articles and taking points (quotes) from a wide variety of sources, including enviro groups, regarding the I.R.A. which I’ve shared with my MoC’s staff.
I. Details and Analysis
Citizens’ Climate University: The Climate Benefits in the Inflation Reduction Act of 2022
40 minute detailed analysis of what’s in the bill, what isn’t, its climate benefits and how far it goes to meet our Paris goals. Given by Dana Nuccitelli, CCL science research coordinator. Contains excellent graphics:
E&E News: Manchin revives climate deal: What’s in the $369B bill
“It would be the biggest and most consequential climate change bill ever passed by Congress and would be part of a larger agreement on a party-line budget reconciliation bill that also includes health care provisions and tax hikes on the wealthy…If Democrats are able to pass it, the deal would be a massive boon for the nation’s pledge to halve greenhouse gas emissions by 2030 and for the climate policies President Joe Biden ran on in 2020.”
E&E News: How Manchin-Schumer would change energy, from oil to solar – Shell PLC Chief Executive Officer Ben van Beurden said during a conference call with reporters he was pleased to see the bill include future leases for offshore oil exploration. . . . “In countries like the U.S. that have a very strong domestic supply position themselves, just curtailing domestic supply in the hope that somehow domestic demand will follow suit is not a realistic policy,” van Beurden said. “If you persist with basically curtailing supply, the only thing that will happen is you will import it from somewhere else.”
Rhodium Group: A Congressional Climate Breakthrough
“Our preliminary estimate is that the IRA can cut US net greenhouse gas emissions down to 31% to 44% below 2005 levels in 2030 compared to 24% to 35% under current policy. It will also meaningfully reduce consumer energy costs and bolster US energy security over the medium-term, and it picks up where the Infrastructure Investment and Jobs Act (IIJA) left off in supporting the widespread commercial deployment of emerging clean technologies. While more action across other levels of government will be required to cut emissions by 50-52% below 2005 levels, the Senate package represents an important and historic step forward.”
Rhodium re: Oil and Gas leasing:
The IRA increases oil and gas royalty and rental rates and increases the minimum bid in onshore lease auctions. It also requires four lease sales by the end of 2022 that were previously included in the 2017-2022 Outer Continental Shelf Oil and Gas Leasing Program, and it implements timing and annual acreage minimums for onshore and offshore oil and gas lease sales as prerequisites for federal renewable leasing and right-of-way issuance. From an emissions perspective, increases in royalty rates put downward pressure on future emissions from oil and gas production. Meanwhile, expanded leasing may put upward pressure on emissions depending on how much private land production (where currently roughly 80% of US oil and gas production occurs) is displaced. At the same time, it’s worth keeping in mind that only a fraction of public land acreage put up for sale actually gets purchased, and only a fraction of sold leases actually get developed. In addition, the minimum acreage requirements—the lesser of 2 million acres or 50% of nominated acreage onshore, 60 million acres offshore—are within historical trends for onshore and offshore lease offerings. We incorporate these provisions into our preliminary estimates of US emission reductions from the package.
U Texas Austin Prof Arvind Ravikumar: “Disagree that O&G leasing provisions is poison pill. – Lease sales are not production. When BOEM offered 75M acres 2021, <3% was leased. – Most O&G firms don’t see oil demand growing. – IPCC says 2050 gas at ~50% of 2020 use even in 1.5C world.”
Princeton REPEAT Project: Encouraging graphics supporting large emissions reductions from the IRA.
“We find that the IRA is the most significant federal climate and clean energy legislation in U.S. history, and its provisions could cut greenhouse gas (GHG) emissions 37-41 percent below 2005 levels. If the IRA passes, additional executive and state actions can realistically achieve the U.S. nationally determined commitments (NDCs) under the Paris Agreement…In other words, the IRA would enable the U.S. to close 50-66 percent of the emissions gap between BAU and the NDC in 2030.
Further, for every ton of emissions increases generated by IRA oil and gas provisions, at least 24 tons of emissions are avoided by the other provisions.
Under a business-as-usual (BAU) scenario (i.e., including all enacted federal and state policies to date) our modeling forecasts the U.S. would reduce emissions 24 percent compared to 2005 levels by 2030.”
Resources for the Future: Retail Electricity Rates Under the Inflation Reduction Act of 2022
- Retail costs of electricity are expected to decline 5.2-6.7 percent over the next decade, saving electricity consumers $209-278 billion, given expected natural gas prices.
- The average household will experience approximately $170-$220 in annual savings from smaller electricity bills and reductions in the costs of goods and services over the next decade.
- Ratepayers are insulated from volatility in natural gas prices, with electricity rates projected to decrease even under a high natural gas price scenario.
- 2030 electricity sector emissions are projected to drop to 69.8 percent to 74.9 percent below 2005 levels, compared to 48.5 percent below 2005 levels without the policy.
Committee for a Responsible Federal Budget: IRA Will Help Fed Fight Inflation
“A recent Penn Wharton Budget Model (PWBM) study has been used by opponents to claim the Infl
Ultimately, we expect the IRA to very modestly reduce inflationary pressures in the near term while lowering the risk of persistent inflation over time and thus make it easier for the Federal Reserve to reduce inflation without causing a recession. Policymakers should follow the IRA with further inflation-reducing actions
CRFB: IRA Saves Almost $2 Trillion Over Two Decades
“The Inflation Reduction Act (IRA) would reduce budget deficits by over $300 billion in its first nine years, but much of the savings would take time to materialize. We estimate the IRA would reduce deficits by $1.9 trillion over two decades, including interest savings. Assuming a permanent extension of the expanded Affordable Care Act (ACA) subsidies, the bill would reduce deficits by $1.1 trillion with interest.”
WaPo: How the Schumer-Manchin Climate Bill Might Impact You and Change the U.S.
Contains lots of good quotes from non-climate groups re health care, tax fairness, black lung, etc, as well as good summary of clean energy and climate provisions.
“Sponsors of the bill, which must still pass the full Senate and House of Representatives, might be expected to oversell its impact. But energy and climate modelers have now scrutinized its 725 pages and concluded the 40% claim is about on target.”
NYT: How the New Climate Bill Would Reduce Emissions:
“This bill does about two-thirds of the work we need to do to hit our climate goals, which for a single piece of legislation is a really big deal,” said Jesse Jenkins, an energy systems engineer at Princeton who helped lead the modeling effort. “And by driving down the cost of clean energy, it can make it easier for states or cities or companies to take further climate actions on their own.” (Includes nice graphic on savings/spending impacts.)
II. Reactions from The White House and environmental groups
“I urge the Senate to move on this bill as soon as possible, and for the House to follow as well.”
“Senate Democrats are preparing to vote on a bill that includes key climate provisions. The Inflation Reduction Act is a HUGE step forward in the fight against climate change. This is the opportunity we’ve been waiting for. We can make sure it passes by making phones ring off the hook in every Democratic legislator’s office.”
“This bill will lower costs for families, protect our planet, and make health care more affordable — all by asking the wealthiest corporations to pay their fair share. Let’s get this done.”
NRDC: Why Congress Must Pass the Climate Bill
“It’s the strongest congressional climate action yet—in the moment we need it most.”
EDF:Long-sought Senate agreement renews hope for historic US climate action
“The act would deliver lower energy costs, healthier communities and significant progress on climate change,” Environmental Defense Fund president Fred Krupp said in a statement. “It would be an historic step by Congress to improve people’s lives.”
Sierra Club: Congress Must Pass the Inflation Reduction Act Immediately
“We Cannot Waste Another Day Without Passing the Single Largest Investment in Clean Energy, Environmental Justice, and Climate Action”
“This agreement affirms that we can address the climate crisis, lower costs for consumers, lift up frontline and rural communities, and invest in made-in-America jobs and clean energy innovation,” said Collin O’Mara, president and CEO of the National Wildlife Federation. “Thank you to Majority Leader Schumer, Senator Manchin, their Democratic colleagues, and all of the grassroots activists who made this historic agreement possible. We still have a great deal of work ahead, but the Senate should swiftly take up this landmark agreement.”
“The Inflation Reduction Act of 2022 would put us on track to reach our energy goals.
Please take a couple of minutes right now—before the vote—to write to your U.S. Senators and urge them to pass legislation to fight climate change THIS WEEK.”
The Hill: Manchin-Schumer deal stuns business lobby
“The climate and tax package unveiled by Senate Majority Leader Charles Schumer (D-N.Y.) and Sen. Joe Manchin (D-W.Va.) on Wednesday stunned K Street firms and big business groups that are now mounting a last-ditch effort to win concessions for their corporate clients….At least 70 public companies hit the profit threshold in 2020 but paid less than 15 percent in federal taxes, according to a report from Sen. Elizabeth Warren (D-Mass.). The lengthy list includes Apple, General Motors, Bank of America, Intel, Verizon and FedEx.”
“Although Senate leaders have included plenty of favors for the fossil fuel industry in the big climate package they hope to advance this week, most analysts have concluded these concessions amount to consolation prizes in a deal where clean energy is the clear winner.
At least three separate analyses by think tanks and academic institutions agree that the Inflation Reduction Act of 2022 would cut U.S. greenhouse gas emissions some 40 percent by 2030—within striking distance of President Joe Biden’s pledge to cut emissions in half…
More evidence of the legislation’s potential to ignite a clean energy transition can be seen in the reaction it has spurred among the most ardent keepers of the fossil fuel status quo. Americans for Prosperity, an advocacy group funded by the petrochemical billionaire Koch family, has launched a campaign blitz to stop the bill. Its online ads in particular are targeting Sen. Kyrsten Sinema, the Arizona Democrat who has not yet taken a position and whose support will be critical to getting it across the finish line.”
