The newly passed climate bill is adding benefits for clean energy.
President Joe Biden signed a climate and health-care law called the Inflation Reduction Act. Tucked into the act is a major expansion of federal loan programs that could help the fight against climate change by channeling more money to clean energy and converting plants that run on fossil fuels to nuclear or renewable energy, The New York Times reports.
The new law will sanction as much as $300 billion in federal loan guarantees for businesses energy and automotive projects. The money could significantly benefit future projects that need money to get off the ground.
“This is a sleeping giant in the law and a real gold mine in deploying these resources,” says assistant energy secretary in the Clinton administration, Dan Reicher. “This massive amount being made available is a big deal.”
Under the Trump administration, which played down the risks of climate change, the department’s loan office was much less active.
The Biden team has been working to change that. Last month, the department said it planned to lend $2.5 billion to General Motors and LG Energy Solution to build electric-car battery factories in Michigan, Ohio, and Tennessee, says The New York Times.
The act will add $100 billion to already existing loan programs for EV production. Up to $250 billion will be added in new loan guarantees and $5 billion to support loan programs.
Backing up a bit
Last week, President Biden signed the Inflation Reduction Act.
The bill includes a $369-billion investment in climate and energy policies, $64 billion to extend a policy under the Affordable Care Act in order to reduce health insurance costs, and a 15% corporate minimum tax aimed at companies that earn more than $1 billion a year. Many see the subsidies to alternative energies as a boost to jump-start these technologies, leading to billions of dollars of growth in the private sector.The billions in climate and energy investment will boost renewable energy infrastructure in manufacturing, like solar panels and wind turbines, and include tax credits for electric vehicles and measures to make homes more energy efficient. Democrats say the bill will lower greenhouse gas emissions by 40%.