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The Inflation Reduction Act: Its Impact On Global Emissions and Green Energy Solutions with Anand Gopal, EnergyInnovation.org

Anand Gopal pictured in front of a solar and wind farm with the title of today’s episode.

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Today’s episode is being turned around lightning fast because we are covering a topic of-the-moment, and that is the Inflation Reduction Act presently being considered by the United States Senate. This Act, should it pass, includes $369 billion with a B in funding for climate and clean energy provisions. 

To discuss this bill, its implications, and ultimately learn about what will happen if it passes, and if it doesn’t, I’m joined by Anand Gopal. Anand is the Executive Director of Strategy and Policy of Energy Innovation, a company that sits at the intersection of policy and technology.

About Our Guest: Anand R. Gopal

Anand R. Gopal is Executive Director of Strategy and Policy at Energy Innovation, where he leads the firm’s research and modeling teams, supporting policy design to reduce emissions equitably at the speed and scale required to meet the climate challenge. Anand has dedicated his career to finding technology and policy solutions for climate change. Anand, who now calls California home, is an immigrant from Southern India.

LinkedIn: https://www.linkedin.com/in/anandrgopal/

Energy Innovation: Policy and Technology, LLC: https://energyinnovation.org

Free Resource Mentioned:

Modeling The Inflation Reduction Act Using The Energy Policy Simulator: https://energyinnovation.org/wp-content/uploads/2022/08/Modeling-the-Inflation-Reduction-Act-with-the-US-Energy-Policy-Simulator_8.1.22.pdf

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Blog Post URL https://caremorebebetter.com/inflation-reduction-act-its-impact-on-global-emissions-and-green-energy-solutions-with-anand-gopal-energy-innovations

A coastal wind farm pictured with today's Climate Science News about The Inflation Reduction Act.
The Inflation Reduction Act: Its Impact On Global Emissions and Green Energy Solutions

Hello, and welcome to Care More Be Better. Every week I invite you to care more so that together we can all learn, grow and become better. We can change the world together. Today’s episode is being turned around lightning fast because we are covering a topic that is of the moment. And that is the Inflation Reduction Act, a bill that is presently being considered by the United States Senate. If this act should pass intact, it includes a $369 billion with a B — in funding for climate and clean energy provisions. To discuss this bill, its implications, and ultimately learn about what will happen if it passes, and if it doesn’t, I’m joined by Anand Gopal.

Anand is the executive director of strategy and policy of energy innovation, a company that sits at the intersection of policy and technology. Anand, welcome to the show.

Thank you. It’s wonderful to be here.

This bill has been called the most significant federal climate and clean energy legislation in US history.

I think you, in fact, even stated, so in a piece that you published called Modeling the Inflation Reduction Act Using the Energy Policy Simulator. So I was hoping that you could talk to us about what this should mean if it passes and why we should be perhaps a little bit excited.

Yeah, thank you. Yes, we all really should be excited.

It’s an incredible, turn of events, even in, in terms of how legislation has unfolded in the last year or so. Look, the US actually doesn’t have a long history of passing, strong legislation federally on climate, and this one is actually something very meaningful. And what we find is that, when we looked at the details of the bill, this piece of legislation, if it passes can actually put the us on track to reduce emissions by 40% relative to its emissions in 2005, by the year 2030.

And that is so close to the US commitment under the Paris agreement of 50% reductions by 2030, and most people have agreed that the us’ commitment under Paris is actually quite a strong, meaningful one. So this legislation is critical and it helps the us fulfill its obligations to the rest of the world from a, even a justice lens, having been the largest historical emitter, and allows the US to be able to meet its commitments that it has made.

And let’s not forget. It’s also a huge industrial policy. It’s set up to create a large number of clean energy jobs in the US. And that is also something that’s unique in how it’s designed.

So this could be looked at in a way as, a catapult forward for this particular generation and something similar to the new deal.

Yes. I mean, um, probably the new deal had a lot of follow ups as well, in addition to, uh, what was done in legislation that made it what it was and how we remember it. We’ll still need that even, even as this bill becomes, if it gets enacted and let’s hope it does, um, for there to be a lot of follow up in how this gets implemented and other complimentary actions that states and, and, uh, and the federal government can take.

And also everyday people can take, but it certainly does have that. Of being transformational enough that we can do something really meaningful on climate. I am more hopeful that this week than I’ve ever been in a long time, having been in this field for almost two decades.

Well, it’s the reason I said we have to go live today and I have to turn this podcast episode around very quickly, because as you stated before, we began this recording and this session, it looks like we could know as soon as Sunday morning, if this passes. So what do we have to be hopeful about as we head forward and what should we pay attention to in the coming 24, 48 and beyond?

Yeah. So for those of those of, the listeners who are actually keen to follow some of the elements of the bill, um, so what we are going to be tracking, me and, a lot of the researchers and many climate activists over the next 48.

Is to see that all of the climate provisions that add up to $370 billion that are in the, the legislation as it’s written, stays in it, as it goes through the, the Senate process, which is, uh, pretty convoluted. But hopefully by, Saturday when we emerge with what’s, uh, what’s the likely bill, all of those things remain.

At a very high level. Let me describe what they are. What the bill tries to do is something that, that a lot of the climate movement has really coalesced around over the last few years. And the simple moniker that we can use to describe that is what I would call a framing of standards, investments, and justice.

And the bill does a really good job on the ladder to investments and justice. And the idea here is the way we fight climate change is to really take advantage of the fact that lots of the clean energy technologies that, um, that are going to solve the problem are really getting cheap much faster than we thought even four or five years ago.

And what we can do is really spur that speed and accelerate the speed of that transition so that we can address the climate crisis in time. And this, this bill puts a lot of incentives and other forms of investment, including in manufacturing of these clean energy technologies in the us. And it also.

The other aspect that’s really important in climate, uh, to address is the fact that, uh, communities that have historically born the brunt of pollution and other aspects of, co-pollutants of the fossil fuel industry that matter other than CO2, like air pollution and other things are also being addressed.

And those communities are also have a significant amount of funding in this. In order for those polluting facilities that are in their backyards to go away and get replaced by either cleaning facilities, or in some cases, just have that polluting facility moved out, uh, without a replacement. And those things are really, really meaningful.

And they also are a departure from how climate policy was thought of maybe about a decade ago, where we leaned in very heavily on markets and carbon pricing.

It sounds to me like, you think this is real, like it’s beyond a pipe dream, but as it stands, as we all know, bills can get gutted in this final stage.

So I know that we can have faith in some of the people that are actually working to get this through. We are relying specifically on all 50 of our, uh, senators who are Democrats, as well as the tiebreaker of Kamela Harris to ensure that this actually does pass and in as close to its present state to actually retain what’s meaningful.

So I guess what I’m getting at is that we are still in the midst of the politics of this all. So I’m curious to know if you have any insights into what could be changed or what’s on the table to be chopped right out of this.

Yeah, I do have some insights, but probably, um, not anymore than the average person closely following the news on this.

Um, it does look like the main concerns were for Kyrsten Sinema. The Senator from Arizona was actually items that were fairly unrelated to the climate provisions in the bill. It was about certain tax provisions that were in there. And it looks like that has now been resolved now with that, I think. The democratic side is now, as far as I understand, fairly happy with everything that’s in there.

And yes, we need every single person on the democratic side to be present as well as vice president Harris to also be present in order to get this through. So, the only hurdles now that remain are whether the Senate parliamentarian. Looks at the certain provisions and makes a decision as to whether or not those things fit within reconciliation.

Our team and also lots of colleagues and others who work in the climate space are fairly confident that the climate provisions that the way they’re structured and put in there are, unlikely to face any risk. It is possible that there are other elements of the bill that I’m not super familiar with, either in prescription drugs or in tax policy that may be a little bit more at risk, but we are very hopeful that the climate pieces will not be, adjudicated, you know, by the parliamentarian as risky or as not fitting with reconciliation.

Well, you did allude to something I planned to ask you, which is that essentially critics of the plan say that it will increase taxes even while Biden says that it won’t. So, what is the reality? What can we expect?

As far as, I mean, the, we are not an expert on the tax policy side of the bill, but what we’ve studied essentially is let me comment on how the climate side actually makes a huge difference for everybody. We know that the way the provisions are written, it’s not increasing taxes on anybody directly, but indirectly there’s huge benefits for the average American consumer.

Just what’s happened right now in the climate world. Something that a lot of people are not aware of. And, and this is something that is also a recent trend. We are on the cusp of lots of technologies that we take for granted in our everyday lives. Our cars, our natural gas furnaces, our stove. Um, how we generate our electricity and use it, all of those things that we, the way we used to do it the way we still do it, in many cases, burning fossil fuels in order to make them and to propel our vehicles — are all so close to being on the verge of being much more expensive. And what this bill does is it makes those cleaner options that are already getting quite a lot cheaper, much cheaper. And so we are soon gonna be in a world where essentially it’s just gonna be cheaper for average Americans to like switch to climate consistent, you know, living, and actually save a ton of money in the process.

Now, our team hasn’t yet run the full numbers on the consumer savings, but some of our friends at the Roadium. Um, have seen, uh, put out some numbers that, that savings at the consumer household level on average from the provisions in the bill could be as high as $1,800 a year, which, who would’ve thought that, right? I mean, a few years ago, climate was always thought of as like, you have to make this sacrifice in order to like, address this problem for future generations. It turns out, thanks to lots of innovation, lots of good policy that we may not need to make that kind of sacrifice. We could benefit from day.

I think one of the things you’re alluding to are the tax credits for things like installing heat pumps in your home, as opposed to using air conditioning and also a centralized heat mainframe, that would be something of what we call an older technology, because those are gaining steam, they require less energy.

They also do require that you do an assessment of your home’s insulation and things along those lines. But if you’re getting tax credits to do things like that, it can be an incredible long-term savings as well as just plain more efficient. Correct?

That’s exactly right. All of these technologies, particularly heat pumps and electric vehicles, they save you money after you buy it every day.

By huge amount. What this bill is doing is it’s also helping you save money before you buy it at the price, uh, level of the, of the appliance, right? So it’s gonna help something that used to be an upfront increase in cost and then savings over time to be an upfront savings in cost and savings over time

Which is incredible.

One of the things that we covered in earlier shows had to do with the need to retrain people that are working in coal gas and propane into jobs that will retrofit buildings, use heat pumps to cool them and build that green infrastructure. So in your opinion, it sounds like this bill will help us do that, and essentially create the infrastructure so that we can move in a healthier direction where we’re not consistently just consuming more and more energy.

Yeah, thank you for raising this. You know, one of the things that is really the people who really do, uh, need a helping hand from us as a society are the folks who have been workers in the fossil fuel industry.

They’re not the ones who set the policies of the fossil fuel industry in the past, and they deserve a chance to be able to also contribute to the clean energy economy. What this bill does is it gives strong incentives for any producers manufacturers who want to set up facilities to manufacture heat pumps, or batteries, solar, wind — in the US.

And then what that’s gonna need is a lot of labor. And guess who’s gonna have the skills to do it. There’s gonna be a lot of people who worked in the energy industries who are gonna have some of the skills to. But I don’t wanna sugarcoat this. The bill is giving that incentive and the money to be able to, to take advantage of it, but it does require a collective effort from various levels of government and companies as well to honestly then retrain workers who are in, um, fossil fuels to be able to like help us, build the clean energy industries of the future.

Let me say one thing though. There’s where there’s a clear, clear, immediate opportunity. So one of the things that we find when we do our energy systems analysis for what the future looks like, the future looks, if we’re gonna be climate consistent, is going to be a world where a lot of things run on electricity.

And in order for that, we need to have lots of clean electricity. And one of the most promising technologies that the us is actually currently lagging and can really catch up on is offshore wind. Offshore wind is one of the most promising new, renewable energy technologies. Lots of installations in China in the UK.

And this bill now gives significant incentives for that. And the skillsets needed to put up those offshore wind rigs. These are like way out in the ocean and far from human site. Really those skills are lie in the, in the hands of oil rig workers today. So there’s a lot of. Immediate opportunities as well for the skill sets of those workers on oil rates.

You’re talking about waters that can be 600 feet or more deep. I have direct experience. I’m a scuba diver. I’ve been scuba diving for a long, long time. And I did a liveaboard boat dive, where we actually got to dive, in waters that were at least 600 feet deep on an oil oil Derrick.

So we took a skiff up to the oil Derrick. We got permission to be there. And then dove beneath the surface to discover what was essentially a reef in the middle of the open ocean, um, alive with all sorts of algae, sea lions, who enjoyed dive-bombing us as we descended. But these were actually visible from the shore.

They weren’t all too far off the coast of Santa Barbara. And so if we’re taking these far off into open water, of course, there are challenges of weather there’s challenges of drilling into the sea floor, whether or not that’s required. I’m not sure I’m not familiar with technology. Are these floating and anchored in some way? How is it actually designed?

They are, yeah, just to be clear. Fortunately, unlike oil. There’s no reason to drill underneath. You just have to make sure that it stays stable even on the, uh, on the ocean. Ah, and you can do that with certain technologies that are floating in nature, where you have enough of a ballast underneath, uh, in order to make sure that the wind turbines stays up.

So it’s pretty interesting.

Yeah, that’s that’s really cool. So essentially it can be done without impacting negatively the Marine life, that’s on the bottom of the ocean floor.

Absolutely. Yeah. So, it’s what is known as floating offshore wind technology. It is something that is more and more common. It’s being installed right now.

There’s some big facilities off the coast of Scotland. And to do that here on the us west coast is also, you know, something we’ll need cuz the ocean gets very deep off the west coast. And when you do that, you don’t actually need to, um, need to disturb anything on the sea floor. Um, there’s, I mean, there’s a minimal amount of anchoring, I think, but there’s not a whole lot and very, very different from an oil.

Wow. Well, that’s incredible. And it does speak though to the technology and, and the skillset being translatable to this new economy that we would ultimately seek to build. So I will ask you if you happen to know people working in that space who could come on and talk about the technology.

I actually, personally, I don’t know anyone who is currently in, in oil rig space.

Oh, no, no. I’m talking about the people in wind.

Yes. The people in offshore wind. Yes, absolutely. Yes. Um, I’d be happy to connect you with them.

Now I’ve been approached numerous times over the course of the last few weeks by people working in oil that are essentially arguing that we’re going to need for oil and propane or gas, natural gas, to be part of the transition and that we shouldn’t ignore these conversations with them.

What is your position on that? And do you think we need to provide air time to those individuals who are still retaining a foothold in the oil space?

Look, the reality is when the oil and gas companies speak about, uh, this, when they use this terminology, they’re actually kind of hedging on acting on the most important actions, this, this decade that they need to take.

They usually speak about a future where they will do something differently, but then it’s too far out for the climate. If it’s oil and gas workers who are worried about their future, I completely understand. It is, it is a real concern and finding a way for them to land well is important. And it really matters in lots of the work that we do, but just at the high level to be very, very clear.

You know, the IPCC [Intergovernmental Panel on Climate Change] has said, uh, recently in their latest report that there is no more room for new exploration and drilling of oil and gas in order for us to, if we’re gonna stay within 1.5 degrees, sea of warming. So the science is pretty unequivocal on that, right. So, I’d love to believe that there’s a different future where we can have lots more hydrocarbons in our economy, but there simply isn’t likely now. The other thing that people will point to is they’ll talk about technologies that are about, you know, sequestering, carbon, underground removal of carbon from the atmosphere — and to some extent, we might need these in a future where, warming is a little bit more extreme. But what we find though, is that the cheapest way to solve our problems on climate is actually to like stop combustion where we can and electricity is a wonderful fuel, and it can do everything we need to do more quietly, cheaper and better, for a lot of the stuff that we use in our everyday lives.

So even for an everyday person, it’s better to move to.

So as the general public, what can we do to ensure that this bill passes? What would you advise people listening who might really wanna do their part in ensuring that Congress and, and the Senate hears them? What would you advise them to do?

The most important this weekend, please, or even today call your Senator.

Let them know how important this is for our future for not only the future of, um, of Americans, but the world as a. This is something that the us can do that can help humanity and, and other species on the planet for generations to come tell them how important it’s for you that they passed this bill.

And, um, if you live in a purple state, uh, particularly, you know, folks in Georgia or Arizona or West Virginia, um, and we have democratic senators from those states, um, and you know, it’s really important that people call them and let them know how important it is that they get behind.

Well, thank you so much for that.

Now, Anand, if there is a question that I haven’t asked that you wish I had, what might it be? And if you could ask and answer that question, or you could also just leave us with some parting thoughts.

Thank you. Well, I think the important question that, that I’ve thought about that, you know, we should all be really prepared for is like how, you know, what does this mean for the climate future of the world as a whole. And when you think about it, that way. Rightfully the US has been a target, uh, for lots of countries in the global south for how the us has taken up so much of the carbon budget, so to speak, since the industrial revolution, the US and Europe.

But in the last, last few months in such an unexpected way, in some sense with, because the politics have shifted back and forth, both the European union and the us are now, you know, assuming this legislation passes — are now on the verge of taking such meaningful action to reduce the remissions this decades, that, it doesn’t right all the wrongs of the past, but it really is a meaningful.

Forward for the planet as a whole. And I’m hopeful that, you know, all of our friends from the global south, you know, I, myself, an immigrant from India to the us are, are going to engage in a much more productive way in addressing climate change for the sake of all of our futures.

Well, thank you so much for that.

Now I have to ask, am I able to make this available to my audience, this paper that your team has written?

Yes, it’s publicly available. Please free to share.

So I will include that with show notes, as well as on my website, caremorebebetter.com. So thank you so much for joining me today. Anand, where can people reach out to you and to your company?

If they’re curious and want to learn more.

Great. So we are online as a www.energyinnovation.org, and I am also on Twitter @anandrg. And you can also please feel free to reach out to, to us media@energyinnovation.org.

That’s fantastic. As I stated before, I will be sure to include all of this with show notes as well.

All you have to do is go to care more, be better.com or to your local podcasting platform. After this airs, I’m going to do my best to ensure that this gets out this weekend. So it can be of the moment and potentially even influence people to go ahead and do that. Call your senators, call your local legislators and just ultimately make sure that their voice is heard that their legislative body understand.

That you want this bill to pass. Now, if you have any questions for me or for Anand, I encourage you to go ahead and send me an email to hello@caremorebebetter.com. It’s a simple way to reach me. You can even go to the website, tap on that microphone in the bottom right-hand corner and leave me a message you can do.

So from your mobile device or your desktop, you can review that message before you send it. And if you say in the message that you’re okay with me sharing it, I may even include it with a future episode. Thank you so much for joining me today. This has been Corinna Bellizzi with Anand Gopal and Care More Be Better. Have a wonderful day.

Guest

  • Anand R. Gopal is Executive Director of Strategy and Policy at Energy Innovation, where he leads the firm’s research and modeling teams, supporting policy design to reduce emissions equitably at the speed and scale required to meet the climate challenge. Anand has dedicated his career to finding technology and policy solutions for climate change. Anand, who now calls California home, is an immigrant from Southern India.

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