I don’t tend to write optimistic articles on climate change and action. Don’t get me wrong, I try my best to end on a positive, or at least a motivational note—but sometimes that’s really hard. However, the Inflation Reduction Act (IRA) gives me hope.

On August 16th, 2022, the bill was signed into law after years of struggle. And while the name may be a little misleading, the IRA isn’t some esoteric economic plan—it will do a measurable good for both the environment and low–income communities. 

Despite having no marked impact on inflation (Penn Wharton Budget Model), the bill will reduce the country’s total deficits by $264 billion over 10 years. Over time the IRA will increase gross domestic product (GDP) and simultaneously contribute to debt and carbon reduction, and tax incentives on investments and working hours.

Notre Dame’s AP US History teacher, Mr. Woolery said, “This is definitely the most significant piece of environmental legislation since the early seventies under Nixon…They’re using market incentives to push people to engage in more climate action rather than telling people what to do.”

The IRA incentivizes clean energy options, such as solar power and electric vehicles, which are far better for the environment than traditional power from fossil fuels. With tax credits to the consumer, the IRA makes individual climate action much more financially viable. It also provides tax credits for the manufacturers of these clean energy products, and specifically encourages these products to be made and produced domestically.

In the US, low–income households are characterized as a family of four with two children making $51,852 or less per year (National Center for Children in Poverty). This bill does its best to make climate action accessible to everyone by providing a 10-20% credit for solar projects in low–income communities and those in federally-subsidized affordable housing.

 It also creates a grant program to help families in affordable housing replace home appliances with equipment that would maximize efficiency and lower clean energy costs. In addition, the IRA will enable the Department of Housing and Urban Development to improve the climate resilience of federal affordable housing.

Low–income communities are the ones who bear the brunt of the effects of climate change, with pollution, poor air quality, and flooding disproportionately affecting poorer areas. By making home efficiency upgrades more affordable and creating economic opportunities and jobs in the clean energy field, this bill recognizes this disparity and works to close the gap. 

Another component of this bill is to protect workers, with minimum wage requirements that attempt to match clean technology wages to that of the fossil fuel industry, which are more likely to have formed labor unions. If any companies eligible for tax credits on clean energy do not meet the wage requirements, they cannot receive the credit. 

A large chunk of the budget of the IRA goes toward nuclear power, which is reliable and carbon–free. However, many people in the US are wary of nuclear power; even environmentalists remain divided on the subject. This may be due to memories of nuclear meltdowns, like that of Chernobyl in 1986. That being said, nuclear power has made incredible improvements, with meltdowns being virtually impossible in new reactor designs. 

Mr. Woolery believes, “if you want to deal with climate change and particularly the effects of carbon emissions, then nuclear power has to be looked at. Nuclear power has to be a part of the climate change approach.” 

The IRA has so many positive objectives, but the extent of its impact on climate change can’t be predicted. However, I believe that the bill will pave the way for more environmental legislation, and build out a clean energy industry in the US. Even though it took far too long to get here, the IRA makes me excited for a brighter, greener future.