As we mark the one-year anniversary of the Inflation Reduction Act, it appears to be living up to its billing as the most significant piece of climate legislation to become law in the United States.
The law is driving investments that are already leading to a spike in deployment of clean energy and development of new clean energy technologies. And, if well implemented, the IRA’s clean energy policies could change the face of our energy sector and set the country on a path toward a more decarbonized economy.
That said, the implementation burden on the Department of Treasury and other agencies is unprecedented. While this process will be iterative and lengthy, there will be significant pressure for the Biden administration to move as quickly as possible, requiring equally expedited engagement by taxpayers with a vested interest in the regulatory outcomes.
The administration knows that industry will have difficulty making investment decisions if the rules are not completed in a timely manner, reducing the effectiveness of the credits in achieving their intended objectives. Treasury has sought public input from groups affected by the clean energy provisions, with the first phase of implementation expected to wrap up in the coming months.
The FGS Global U.S. Energy & Sustainability and Tax & Financial Services teams are available to help understand the landscape and opportunities at ESTeamDC@fgsglobal.com.