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Plus, a drought disrupts shipping
Welcome back, climate leaders.
In today’s edition:
🏠The IRA’s benefits for homeowners
🚢 Drought is disrupting shipping in the Panama Canal
đźš— A breakdown of the $72m in EV manufacturing investments in the past year
Read time: 5 minutes
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BIG STORY
Driving the news: This week marks the one-year anniversary of the Inflation Reduction Act. Despite the potential financial benefits, a significant portion of Americans are completely unaware.
The IRA provides funding for a wide range of home improvements to enhance energy efficiency, from solar panel installations to window replacements.
Surveys indicate that 66% of the population is unaware of the incentives for installing solar panels, and 77% haven't heard about the subsidies for heat pumps.
What's happening: There are two primary incentives: unlimited tax credits and $8.8 billion in rebates.
The tax credits are immediately available, but the rebates, managed by individual states, are still in the pipeline and require further definition.
Programs cover a wide range of home improvements aimed at increasing energy efficiency and reducing fossil fuel usage, such as solar panels, insulation, windows, and electric appliances.
Tell me more: The key consumer benefits of the IRA, according to Heatmap News:
Tax credits
30% off energy audits, windows, doors, insulation, air sealing, heat pumps, and electrical panels, with a $3,200 annual limit and specific item caps.
30% off solar panels, solar water heaters, batteries, and geothermal heating systems, indefinitely renewable.
Rebates
Discounts based on energy reduction, capped at $8,000 for lower-income households and $4,000 for others, determined by state energy offices.
Discounts on specific electric appliances, capped at $14,000, exclusively for low- to moderate-income households.
Other stipulations
Renters below 150% of the area median income can qualify for appliance rebates without landlord permission.
Multifamily building owners can access substantial funding for energy efficiency projects, up to $400,000 through the performance-based rebates program.
Why it matters: The Inflation Reduction Act is not a fleeting opportunity.
The rebate programs will persist until funds are exhausted. However, the tax credits have no such limitation and are projected to be available for the next decade.
This means homeowners don't need to rush into decisions but can plan their home improvements strategically. It's also essential to note that while some rebates might be more beneficial when combined with tax credits in the future, others, like those for solar panels, are better used now.
What's next: For those considering home improvements, starting with a professional home energy audit is recommended. This audit, partially subsidized by the Act, will provide insights into the most impactful energy-saving measures for individual homes.
🌶 Hot take: We talk a lot about EV manufacturing and utility-scale renewables, but none of that matters if supply is not met with demand. Take the free money and electrify your life.
HOT TOPICS
🔆 Solar manufacturing: First Solar chooses Louisiana for its next solar panel factory, a $1.1 billion investment, set to be the state's largest. The facility will create over 700 jobs, benefiting from Louisiana's talent pool and academic institutions like the University of Louisiana at Lafayette.
🚢 Shipping drought: Long delays at Panama Canal after drought restricts ship traffic. The Panama Canal Authority has imposed limits on vessels due to water scarcity, causing a backlog of ships.
đźš— EV IPO: Vietnamese electric carmaker VinFast surpasses Volkswagen and Ford in market capitalization after a successful debut on Wall Street, with shares surging 270% on their first day of trading, pushing its market cap above $85 billion.
🌍 IRA global effects: US climate law impacts global trade rules as foreign leaders respond with their own policies. The law has lowered US emissions and boosted domestic manufacturing but has mixed effects on global decarbonization and reducing reliance on adversaries.
đź’° Climate tech exit: Occidental acquires direct air capture startup Carbon Engineering for $1.1B, validating the industry and highlighting Big Oil's interest in carbon removal.
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CHART OF THE DAY
One year ago, the #inflationreductionact was signed into US law. Since then, we at @BloombergNEF have tracked EV and battery investments in North America. This first year we saw a total of $72 billion in announced pledged investments by automakers, battery manufacturers…
— Corey Cantor🌕 (@CoreyBCantor)
2:34 PM • Aug 16, 2023
ACCLIMATE RECS
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POLL TIME
What IRA incentive are you most excited about? |
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