New climate law has bipartisan roots — we need leadership from both parties to realize its potential

President Joe Biden’s historic Inflation Reduction Act (IRA) of 2022 has been hailed as “the most significant U.S. climate law ever enacted.” To earn this title, it supplanted a climate law signed by former President Donald Trump. History shows that while the IRA was a Democratic initiative, it builds on Republican-backed laws that have brought economic development to all 50 states. We will need bipartisan leadership going forward to advance effective solutions to climate change.

On Dec. 27, 2020, Trump lent his signature to a bipartisan appropriations law that extended tax credits for solar, wind and carbon capture technologies. It also initiated a major reduction in hydrofluorocarbons (HFCs), which are highly potent greenhouse gases. Leading environmentalists celebrated the act as the most significant federal climate law to that point.

Democrats were able to pass the IRA, which also includes health and tax provisions, along party lines through the budget reconciliation process because they control the House, Senate and White House. Had the climate provisions been considered as part of a bipartisan package, there may have been some Republican support for pieces of the bill. Clean energy incentives in the IRA and the December 2020 appropriations bill evolved from laws with bipartisan roots.

Iowa’s Republican Sen. Chuck Grassley is the original author of the wind energy production tax credit (PTC), which was established in 1992. The solar investment tax credit (ITC) was established in 2005 through an energy law signed by Republican President George W. Bush. These marquee policies, which were extended in the IRA, helped wind and solar energy grow to produce 12 percent of U.S. electricity in 2021, and become the leading sources of new generating capacity in recent years. Half of the top 10 states for wind and four of the top 10 states for solar are represented by Republican U.S. senators.

Renewable energy is not alone in benefiting from tax breaks. Among other policies, fossil fuels continue to benefit from the percentage depletion allowance, which has been in the tax code for oil and gas since 1926 and coal since 1932. While the first scientific paper linking greenhouse gases with climate warming was published by Eunice Newton Foote in 1856, it was over a century before carbon management for fossil resources was widely discussed. The tax credit for carbon capture, use and storage (CCUS) was first signed into law by Bush in 2008. Projects that capture carbon dioxide from smokestacks or directly from the air are already helping reduce emissions and will play a greater role going forward.

The IRA builds on the tradition of incentivizing energy production and provides a decade-long window of policy certainty for renewable energy, energy storage, carbon capture, hydrogen, nuclear, clean energy manufacturing, clean cars and clean fuels. Over the next decade, this “all of the above” approach to clean energy will lead to investment throughout the country, create more than 9 million jobs, and save up to $220 per year for the average American electric consumer. Realizing these investments will bolster America’s leadership in addressing climate change with benefits to both red states and blue states.

Wyoming Republican Sen. John Barrasso recently said, “We all believe climate change is real. We believe mankind is certainly contributing to that. And we also believe that if China and India don’t do things, even if we were to go to zero emissions in the United States, the global emissions continue to go up.”

He is right that we need to work with other countries on climate. American leadership has helped solve global environmental problems before. The Montreal Protocol, a treaty signed by President Ronald Reagan, successfully addressed ozone-depleting gases. While we have a long way to go on carbon, other nations, including China and India, are investing in clean energy, too. North Dakota Republican Sen. Kevin Cramer made a strong case for the U.S. to use its leadership position within the Paris climate agreement “to latch onto what unifies us and promulgate it to the world.” He suggested we do this by marketing our carbon capture and nuclear technologies abroad.

This month’s historic climate bill will help the United States do just that. The Paris Agreement sets up a framework for international cooperation that will only be successful if nations act. With the IRA incentives in place, the United States can cut greenhouse gas emissions 40 percent below 2005 levels. This puts us in a better position to market our homegrown technologies worldwide and help other countries meet their commitments. We will need to continue progress to achieve President Biden’s goal of net-zero greenhouse gas emissions by 2050.

While climate change is a global issue, the investments unlocked by the IRA will be implemented at the state and local level through permitting decisions for electric generating projects, transmissions lines and carbon capture proposals. At its best, the law could encourage large-scale expansion of U.S. manufacturing, new clean energy jobs and economic diversification for communities, with targeted investments in oil, gas and coal producing areas. Americans will need leaders from both sides of the aisle to foster this economic opportunity. Initiatives from Democrats and Republicans have gotten us where we are today, and bipartisan cooperation will be needed to maximize the deployment of climate solutions going forward.

Tom Carlson is board president for the Mid-Atlantic Renewable Energy Coalition. He is also director of regulatory and legislative affairs for EDF Renewables as well as the government affairs co-lead for the company’s joint venture Atlantic Shores Offshore Wind.