The Inflation Reduction Act is Working. So is America.
By now, there’s a good chance the nation’s most important climate and clean energy policy is already creating jobs and driving economic growth in your state.
And maybe in ways you might not expect.
E2’s just-released analysis of the economic benefits since the Inflation Reduction Act (IRA) was signed into law one year ago shows that private companies have announced more than $86 billion in investments in 210 major clean energy projects in 38 states. These projects promise to create more than 74,000 good-paying jobs in the hottest business sector on the planet right now.
“This law is one of the biggest drivers of jobs and economic growth this country has ever seen,” President Biden said at an Aug. 16 White House event marking the anniversary, which I was fortunate to attend.
He’s right. The list of electric vehicle factories, battery plants, solar and wind projects — a list you can see here — goes on and on and on.
But while the law’s tax credits and other incentives are encouraging big companies to expand and consumers to buy EVs and solar and energy efficient heat pumps and other appliances, the IRA also is giving a huge boost to an even bigger — albeit sometimes overlooked — part of our economy:
Small businesses.
For every major clean energy factory coming out of the ground across America, many more small businesses — solar installation companies, construction contractors, energy efficiency and heating and air conditioning businesses — are seeing a boom.
Just ask Amanda Godward of greater Detroit.
Thirteen years ago, Godward left a career in the auto industry to start Ecotelligent Homes, an energy efficiency company that helps homeowners reduce their monthly power bills and make their homes more comfortable with insulation, better doors and windows and more efficient appliances.
Business has never been better. Since the IRA was passed, providing tax credits and grants for energy efficiency upgrades to homeowners, Godward hired three new employees, and next year she expects to add at least 4–6 more to keep up with demand.
“Federal investments through the IRA are driving huge demand by homeowners who want to invest in energy efficiency and renewable energy upgrades,” she said on a press conference call organized by E2.
“And while huge clean energy projects are making headlines, especially here in Michigan, the IRA is also supporting skilled trade jobs at smaller employers like us, and giving small businesses the confidence to grow,” she said.
In Los Angeles, the investments from both the IRA and the separate bipartisan infrastructure law is turbocharging another small business.
GreenWealth Energy installs electric vehicle charging systems. Since the laws were passed, the company has barely kept up with all the work it is getting.
GreenWealth founder and CEO Ariel Fan said the Biden administration’s climate and clean energy policies are not just driving new work for her minority and woman-owned business. The equity and environmental justice provisions of the laws also are helping her advance her and her company’s goals advancing environmental and social prosperity for all, she said.
The policies also are doing something else, Fan said: They’re improving access to financing and capital for her company and generating interest from investors such as Goldman Sachs to Microsoft.
“I can honestly say I’m living my dream,” Fan said.
The small businesses benefitting from the IRA go far beyond clean energy companies, too. For every $1 spend on manufacturing in America, there’s a total impact of about $2.60 to the economy, according to the National Association of Manufacturers.
Construction workers building factories need materials and supplies. Workers at those plants need dinner and housing. All of that filters down to local restaurants, hotels, building suppliers and retailers.
We’ll see more of that in the months and years to come as these projects get going.
For now, though, the message is clear: The IRA is already driving an economic revolution the likes of which we haven’t seen in generations.
It’s working. And so is America.
