Underserved communities are the ones benefitting the most from the Biden administration’s Inflation Reduction Act (IRA) climate efforts, the Treasury Department announced Wednesday.
The data suggests the law is achieving its goal of revitalizing communities that were dependent on fossil fuel production in the past, the Treasury said, based on a new analysis.
“President Biden’s Investing in America agenda and the Inflation Reduction Act are achieving their goals of revitalizing communities that have been overlooked and need public investment to unlock private capital,” Treasury Secretary Janet Yellen said in a press release. “Treasury analysis shows that funding is going where it’s needed most across the country, not just to the coasts or to wealthy communities.”
Since the law passed in August 2022, economies dependent on fossil energy jobs and areas with higher-than-average unemployment levels saw the largest growth, the new analysis found.
According to the analysis — conducted jointly with the Massachusetts Institute of Technology and the Rhodium Group — a majority of the technological investments have gone to economically disadvantaged counties with below-average wages, household incomes, employment rates and levels of college-educated employees.
The IRA is delivering investment to “left-behind places, communities at the forefront of fossil fuel energy production and those that have benefitted least from the economic growth of the past few decades,” authors of the report said.
The economic data show government investment in underserved communities has the highest “bang for the buck” by unlocking existing opportunities, Yellen said.
Eric Van Nostrand, a Treasury economist, said the IRA has increased clean energy investment in communities dependent on energy jobs to $5 billion per month and increased investment in nonenergy-dependent communities to $4 billion each month.
“Put simply, clean energy investment is booming throughout the United States, and investment is growing even faster in Energy Communities,” Van Nostrand said.