The US Senate passed a US$739 billion package, dubbed the Inflation Reduction Act, authorising the biggest burst of spending in US history to tackle climate change, lower medicine prices and raise some corporate taxes.
Approximately US$370 billion will be spent over 10 years featuring tax credits aimed at steering consumers to electric vehicles and encouraging electric companies to transition to renewable energy sources like wind or solar power. Energy experts say the measure will help the United States reduce greenhouse gas emissions about 40 percent below 2005 levels by 2030. Tax credits include:
- US$30 billion to speed the production of solar panels, wind turbines, batteries and critical minerals processing;
- US$10 billion to build facilities to manufacture electric vehicles and solar panels;
- US$60 billion to help disadvantaged areas affected by climate change, including US$27 billion for the creation of a national “green bank”, and
- A US$7,500 tax deduction when buying a new electric vehicle.