The potential climate and economic benefits of the surprise reconciliation package Democrats unveiled last week and are likely to pass as soon as this weekend are starting to come into a clearer view.
Researchers have crunched the numbers to forecast how the more than 100 climate provisions in the $740 billion deal, called the Inflation Reduction Act, would impact planet-warming carbon emissions, jobs, electricity prices and more.
The findings have given climate advocates, Democratic lawmakers and the majority of American voters who support the bill a lot to celebrate.
Three independent research organizations — the Rhodium Group, Energy Innovation and the REPEAT Project — found that the bill, if passed, could slash U.S. carbon emissions by 40 percent or more below 2005 levels by the end of the decade.
Those estimates came just a few weeks ago when Rhodium released a report warning the U.S. was way off track of meeting its emissions reduction goals. That analysis found that without additional policy actions, the U.S. would reduce planet-warming emissions 24% to 35% by 2030 — far short of Biden’s 50% to 52% target.
The economic package includes $369 billion in climate and clean energy spending. If passed, it would be the most significant investment the U.S. has ever made to confront fossil fuel-driven climate change and its mounting impacts.
Talks seemed to have collapsed for the third and final time last month between the White House and Sen. Joe Manchin (D-W.Va.) over a historic clean-energy spending package in Congress’s reconciliation bill, a piece of budgetary legislation that Democrats can pass without a single Republican vote. Given the Senate’s 50-50 split, doing so would require every Democrat’s vote – giving Manchin, a frequent critic of Biden’s agenda and chair of the Senate Energy Committee, unrivaled leverage over the negotiation.
Manchin signed off on the bill last week. And on Thursday, Sen. Kyrsten Sinema (D-Ariz.), another key swing vote, announced her support, all but guaranteeing Democrats will have just enough votes to pass it.
“This package, additional action from executive agencies and subnational actors can put the U.S.’s target of cutting emissions in half by 2030 within reach,” the Rhodium analysis found.
The bill’s climate investments are also expected to jumpstart clean energy jobs, lower electricity bills and improve public health.
It could ultimately lead to the creation of more than 9 million jobs over the next decade, according to a new analysis commissioned by BlueGreen Alliance, a coalition of labor unions and environmental organizations, and conducted by the Political Economy Research Institute (PERI) at the University of Massachusetts Amherst. That includes nearly 6 million jobs in clean energy deployment and manufacturing, 600,000 focused on protecting forests and other natural resources, and 150,000 to confront pollution in low-income and BIPOC communities.
Energy Innovation’s report found the IRA would create closer to 1.5 million jobs, primarily in manufacturing and construction, and prevent up to 3,900 premature deaths, about 100,000 asthma attacks and up to 417,000 avoided lost workdays by 2030.
As for how much the average American household would expect to save on future energy bills, Resources for the Future estimates it could amount to between $170 and $220 per year over the next decade. That would translate to up to $278 billion in total savings for consumers nationwide.
Moody’s Analytics pegged the potential savings at more than $300 per year for the average household.
Biden touted the package’s potential job opportunities, health benefits and energy savings during a Thursday roundtable with business and labor leaders.
“The vast majority of people in America support what’s in the Inflation Reduction Act,” Biden said. “So my message to Congress is this: Listen to the American people. This is the strongest bill you can pass to lower inflation, continue to cut the deficit, reduce healthcare costs, tackle the climate crisis and promote America’s energy security, all while reducing the burdens facing working-class and middle-class families. Pass it.”
A poll conducted this week by environmental group Climate Power and think tank Data for Progress found that 73% of all likely voters, including 95% of Democrats and 52% of Republicans, support the reconciliation package.
Alexander Kaufman contributed to this report.