In August, United States President Joe Biden signed into law the Inflation Reduction Act (IRA), which represents the most robust investment in decarbonization and efforts to combat climate change in United States history with climate related provisions totaling $369 billion.
Meeting global commitments
The bill is estimated to lower carbon emissions by around 40 percent from 2005 levels by the year 2030, which will bring the U.S. within range of meeting its international climate commitments. According to Casey Katims, Executive Director of the U.S. Climate Alliance, “It’s not all the way there…[but] what this bill does is provide a pathway for that target to be within striking distance.” Under the Paris Agreement, the country has pledged to lower emissions by 50 to 52 percent from 2005 levels by 2030. Still, experts say that the passing of the bill has repositioned the U.S. in the global effort to fight climate change, especially as it comes just months ahead of COP27, the 27th session of the UN Climate Change Conference.
Set to be held in November, COP27 will bring the world’s leaders together in Egypt to discuss stepping up their efforts to address the climate crisis. One particular focus of this year’s conference is implementation action, and the passing of the Inflation Reduction Act gives the United States the ability to say that it is taking action to follow through on its commitments. Furthermore, Katims says, “by being able to demonstrate the credibility of President Biden’s commitment, the U.S. will be in a better position to ask and urge international partners to step up their own climate commitments.”
Strengthening leadership in clean energy
In addition to the immediate legitimacy that the IRA will lend to the United States at COP27, the legislation could also increase U.S. standing globally in the transition to a clean energy economy over the long term. After decades of trailing behind international competitors like China in clean energy production, the major investments into sectors using decarbonization technologies include incentives that target both firms and consumers in order to redesign the U.S. energy market. The Council on Foreign Relations reported, “with this bill, Congress is not only trying to decrease emissions, but also to do so in a way that helps the United States emerge as a clean energy industrial powerhouse.”
If successful, this legislation will allow American firms to better compete with their international counterparts and increase U.S. energy independence. From a strategic standpoint, this means that the United States will be better insulated from geopolitical factors that can threaten energy security when energy production is concentrated abroad, the advantage of which has become all the more evident following the Russian invasion of Ukraine.
Advantages outweigh the disadvantages
Despite these undeniable advantages, there are parts of the IRA that activists say run counter to climate goals. In addition to the 10-12 percent gap in emissions that the United States will still need to close in order to meet its pledge under the Paris Climate Agreement, the largest criticism of the bill is that it still includes a number of fossil fuel provisions, such as those that require mandatory lease sales for oil and gas extraction as a prerequisite for renewable energy development on public lands and at offshore sites. Consequently, some argue that tying renewable energy development to oil and gas extraction in this way not only undermines the goals of the other provisions but will also continue to actively harm to the environment.
For others though, the bill remains a historic step that will overall benefit the climate and the country both domestically and on the international stage. At COP27 the fossil fuel provisions are unlikely to seriously undermine the United States’ message, which will undoubtedly involve using the IRA as an example of the country’s dedication to the fight against climate change. Consequently, the bill is expected to influence the role of the U.S. in global climate diplomacy in the short term by better positioning it to urge other countries to commit to and do more in order to address the climate crisis. In the long-term, its implementation, if successful, should continue to bolster the United States’ credibility from both a diplomatic and strategic perspective.
By The European Institute for International Law and International Relations.
