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Inflation Reduction Act

Investing in a clean energy future

Infrastructure funding

While the Infrastructure Investment and Jobs Act (IIJA) is focused on fixing and upgrading our nation’s infrastructure networks, the $20 trillion1 U.S. economy also relies private sector contributions to our infrastructure resources. Acknowledging that this sector represents over 40 percent2 of the world’s greenhouse gas emissions, meeting the federal government’s economy, social equity, climate resilience and sustainability goals also requires supporting and enabling investment in commercial assets. 

The Inflation Reduction Act (IRA), a.k.a. the Climate Act, was signed into law on August 16, 2022. Its purpose is to address inflation, while further supporting a reduction in carbon emissions by roughly 40 percent by 2030 through grants and tax credits in domestic energy production and manufacturing.

Footnotes

  1. World Bank national accounts data, and OECD National Accounts data files, 2022
  2. Global ABC Global Status Report 2021, EIA

IRA overview

IRA aims to reduce inflation via loans, grants, tax credits and rebates.

$435+ billion

Investments across energy security and climate change, Affordable Care Act extension, and western drought resiliency.

$238 billion

Expected deficit reduction over a decade.

~$222 billion

Total funding allocated for various loans, grants, technical assistance programs across sectors.

Funding criteria

Projects that target climate resiliency, sustainability, healthcare, reduction of emissions and use of natural resources.

Recipients

Includes states, tribes, local governments, governmental agencies, NPOs, institutes of research / higher education.

IRA loans and grants by categories

Source:  KPMG analysis of the H.R.5376 - Inflation Reduction Act of 2022, 117th Congress (2021-2022)
Source: Committee for a Responsible Federal Budget website, September 7, 2022

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