Inflation Reduction Act to create 67,000 jobs & $2 billion income in rural US: Report

Inflation Reduction Act to create 67,000 jobs & $2 billion income in US: Report. Photo: Pexels

Inflation Reduction Act was signed into law in the United States in August 2022. The act aims to set newer policy measures to reduce carbon emission, improve healthcare and taxpayer compliance. It also allocates money directly to environmental justice priorities. According to McKinsey, the Inflation Reduction Act is the third piece of legislation in the US passed since 2021 seeking to improve economic competitiveness, innovation, and industrial productivity.

As the policy measure completes one and half year, we delve to see how it has impacted the rural parts of the US so far. According to Environmental Entrepreneurs, a nonpartisan group of business leaders, investors, and professionals from various sector in the US, IRA incentives have led to 52 rural manufacturing projects that are expected to create 67,000 rural jobs and nearly $2 billion in worker income, creating opportunities and revenues for rural sector.

Further, the analysis said, “The IRA funds helped more than 900 rural electricity co-ops supply cleaner, more efficient, and more affordable energy to their members. It also made clean energy and energy efficiency projects more accessible for local businesses, community organizations, farms, and municipal buildings.”

The Inflation Reduction Act is also expected to slash gas prices by 13 percent and electricity prices by 9 percent in the US, stated a report by Forbes. IRA has paved the way for investors to allocate capital to low-carbon solutions including harnessing the wind and sun and converting to electric vehicles.

As far as farmers are concerned, the E2 report also highlighted the benefits of the IRA investment of $20 billion over five years through the US Department of Agriculture’s conservation programs for farmers. The IRA funds are projected to help farmers in efforts to cut input costs, improve crop resilience and soil health.

A recent analysis by a non-profit organisation Rocky Mountain Institute found that, “IRA programs have the potential to unlock more than $1 billion in investments in every state by 2030, provided consumers and businesses adopt clean technologies at the pace needed to meet national climate targets. Texas and Georgia, could see $131 billion and $16 billion of investments respectively.

According to another RMI analysis, a $10 billion investment in wind and solar projects for co-ops can yield just over $50 billion in wind and solar-induced economic development revenues. By 2030, a carbon-free grid could deliver nearly $11 billion per year in direct benefits to rural communities.