As this story goes to print, the U.S. House of Representatives is set to vote on a landmark energy, healthcare, and tax bill called the Inflation Reduction Act of 2022 (IRA).
The $433 billion bill is poised to be the country’s biggest clean energy investment in U.S. history, while also delivering healthcare subsidies for millions of Americans and enacting a 15% minimum tax on corporations that make more than $1 billion in profits.
The lion share of the funding in the bill ($360 billion) is related to clean energy issues.
Included in that funding is: $8.3 billion in credits and financing to help install emission-reducing technologies; $5.8 billion for decarbonizing the industrial sector, such as investment in pollution-control technologies; $25 billion for natural decarbonization solutions, including strengthening carbon management practices for farms; $1 billion for States to adopt updated building energy codes on a voluntary basis; and the opportunity for consumers to receive one-time tax credit incentives of up to $7,500 for the purchase of a new electric vehicle.
However, one of the most significant parts of the legislation is the extension of tax credits for wind and solar and the addition of new technologies to the list including geothermal, nuclear, and hydrogen.
In the past, tax credits for these forms of energy generally lasted for one to three years. However, the tax incentives in this bill will last for 10 years.
Additionally, for the first time ever, davis bacon wages, apprenticeship, and U.S. component manufacturing requirements have been included as bonus tax credits.
“The inclusion of tax credits for federal prevailing wage and the use of apprentices on private job sites is a big deal,” said Chuck Parker, President of the West Virginia State Building and Construction Trades. “This will ensure good jobs are created as a result of this bill.”
Proponents of the bill claim that it is revenue neutral, paying for itself by implementing a 15% minimum tax on corporations that make more than $1 billion in profits per year.
“Senator Joe Manchin has found a commonsense path forward for West Virginia that will save the state’s economy and create new jobs,” said Parker. “The Inflation Reduction Act of 2022 is a gigantic win for West Virginia and for people who work for a living.”