Following a successful House vote on Friday, Congress formally passed the Reducing Inflation Act, clearing the way for the largest clean energy package in U.S. history. President Joe Biden is expected to soon sign the bill into law, enabling the United States to meet its climate goals under the Paris Agreement.
The bulk of the bill’s spending — $369 billion — is dedicated to building domestic manufacturing of electric vehicles and clean energy technologies, and making homes and buildings more energy efficient. Another $4 billion is being used to improve drought resilience in the western United States. In addition to climate initiatives, the bill also spends $64 billion in health care subsidies to prevent higher premiums for people who buy insurance through the public market. U.S. greenhouse gas emissions are down about 40 percent from their peak levels this decade, according to independent analysis. That’s still below the 50% to 52% cuts Biden promised under the Paris climate accord. But it will go a long way in preventing catastrophic heatwaves, wildfires, hurricanes and other climate-driven disasters that get worse as global temperatures rise. Globally, greenhouse gas emissions need to be cut by roughly half within this decade to avoid coral reef extinction and more than doubling the proportion of the global population exposed to extreme heatwaves.
The bill is seen as a last chance for Democrats to pass sweeping climate legislation by a narrow margin in Congress. The Senate passed the settlement bill after more than a year of intense negotiations with Sen. Joe Manchin (D-WV).
As part of a compromise, the final bill would water down pollution reduction provisions and require more federal lease sales for oil and gas drilling than earlier versions. It also expanded tax credits for controversial carbon capture technologies backed by fossil fuel companies. Big oil companies use the technology to “enhanced oil recovery” — shooting captured carbon into the ground to extract hard-to-recover reserves — and then claim that the oil they produce is “carbon neutral.”
In another concession to Manchin, Democrats are also working on a side agreement that would simplify gas pipeline licensing. Climate and environmental justice advocates warn that the measures could prolong reliance on fossil fuels and the pollution that comes with them — continuing to hurt communities near oil and gas infrastructure.
The United States remains the world’s second-largest climate polluter after China, and the largest emitter of greenhouse gases in history. Therefore, the current push to reduce U.S. emissions is critical to global efforts to limit climate change.