ESG – What is included the Inflation Reduction Act?

Earlier this week the President signed into law the Inflation Reduction Act.  Without pontificating on its virtues or short comings, here is how the Inflation Reduction Act breaks down by the numbers:

HEALTH CARE:

Cutting Prescription Drug Cost

As estimated by the office of Management and Budget:

5-7 million Medicare beneficiaries could see their prescription drug costs reduced because of the provision allowing Medicare to negotiate prescription drug costs; 

50 million Americans with Medicare Part D will have their costs at the pharmacy capped at $2,000 per year, directly benefiting about 1.4 million beneficiaries each year; 

3.3 million Medicare beneficiaries with diabetes will benefit from a guarantee that their insulin costs are capped at $35 for a month’s supply.

Lowering Health Care Costs – per the White House:

13 million Americans will continue to save an average of $800 per year on health insurance premiums under Obama Care;

3 million more Americans will be eligible for health insurance; and

The current uninsured rate is at an all-time low of 8%.

CLEAN ENERGY:

Lowering Energy Costs

$14,000 in direct consumer rebates for families to buy heat pumps and other energy efficient home appliances;

a 30% tax credit for solar on roofs program, saving families and estimated $9,000 over the life of the system or at least $300 per year;

Up to $7,500 in tax credits for new electric vehicles and $4,000 for used electric vehicles, helping families save $950 per year – noting there are requirements that various parts of the car be made in America which at this time is not part of the supply chain;

The Administration has stated that their goal in the IRA is to power homes, businesses, and communities with much more clean energy by 2030, including adding:

950 million solar panels;
120,000 wind turbines; 
2,300 grid-scale battery plants;
Advance cost-saving clean energy projects at rural electric cooperatives serving 42 million people;
Strengthen climate resilience and protect nearly 2 million acres of national forests; and 
Creating millions of good-paying jobs making clean energy in America.
Reducing Harmful Pollution

The hope is that through these actions, the IRA will help reduce greenhouse gas emissions by about 1 gigaton in 2030, or a billion metric tons – 10 times more climate impact than any other single piece of legislation ever enacted.

Moreover, the Administration is incenting carbon capture technology in order to deploy clean energy and reduce particle pollution from fossil fuels to avoid up to 3,900 premature deaths and up to 100,000 asthma attacks annually by 2030.

Fuel For Thought – while some argue that the IRA is too expensive and that carbon reduction goals are not necessary, others view these steps as a good step but not nearly enough to reduce green house gas emissions as set forth in the Paris Accord by 2030.  Wherever you come out on this topic, taking steps to reduce our own personal greenhouse gas impact are within our own power.  As such, if you don’t believe that humankind contributes to green house gas impacts and global warming then try doing something to help your own personal reduction to support those that really believe this is a serious issue.  Your own reduction cannot hurt and it just might help if we all engage and look to help.

Duane Morris has an active ESG and Sustainability Team to help organizations and individuals plan, respond to, and execute on your Sustainability and ESG planning and initiatives. We would be happy to discussion your proposed project and how the Inflation Reduction Act might apply with you. For more information or if you have any questions about this post, please contact Brad A. Molotsky, Jeff Hamera, Nanette Heide, Joel Ephross, Jolie-Anne Ainsley, Robert Montejo, Seth Cooley or David Amerikaner or the attorney in the firm with whom you in regular contact or the attorney in the firm with whom you are regularly in contact.

 

ESG – NJ BPU awards 165 MW of Community Solar in Yr 2 of Pilot Program

Earlier this week, on October 28, 2021, the New Jersey Board of Public Utilities (“BPU”) approved 105 applications under New Jersey’s Community Solar Energy Pilot Program.  The applications and awards will create 165 megawatts of clean energy – enough energy to power approximately 33,000 homes – available to low-to-moderate income and historically underserved communities. Year 2 of the pilot program represented a significant increase in the amount of power generated (i.e., from 78 MW to 165 MW) and the number of applications seeking to install community solar.

According to Governor Murphy, “our Community Solar Pilot Program is a national model for clean energy equity and environmental justice, This program not only makes solar available to those in historically underserved communities, but also will spur economic growth and create career opportunities for a diverse, more inclusive workforce. Community solar is a key pillar in our commitment to transition New Jersey away from harmful emissions and towards 100% clean energy by 2050.”

A community solar project is a solar array whose output is divided between multiple homes or businesses that want to use renewable energy but don’t have a solar array on-site.

Community solar programs aim to create a more equitable solar market.

According to NJ BIZ, the projects will each allocate a minimum of 51% of their capacity to low- and moderate-income participants and will all be located on landfills, brownfields or rooftops.

Though 105 projects were approved, the NJBPU received 412 applications, representing almost 804 MW, for the second year of the pilot program.

In the pilot program’s first year, the BPU received a total of 252 applications representing more than 650 MW of total capacity, and approved 45 applications providing almost 78 MW in solar energy capacity.

Earlier this month, the BPU announced that it will be moving forward to make the Community Solar Pilot Program permanent.

Triple Bottom Line – New Jersey continues to be a factor in the US solar market place.  Making the community solar pilot program a permanent program will continue to position the state as a leader in solar deployment and per capita renewable energy use.  The power creation represented by the program will likely solidify existing solar jobs  and create new ones to service the demand for installations and service.  Low and Moderate income families will benefit by the cheaper cost of energy given the renewable nature of the deployment.  As the program moves to a permanent status we will continue to keep an eye on the regulations and report back with our findings.

Duane Morris has an active ESG and Sustainability Team to help organizations and individuals plan, respond to, and execute on Sustainability and ESG planning and initiatives within their own space. We would be happy to discussion your proposed project with you. For more information, or if you have any questions about this post, please contact Brad A. Molotsky, Nanette Heide, Jolie-Anne S. Ansley, David Amerikaner,  Seth Cooley, Vijay Bange, Stephen Nichol, or the attorney in the firm with whom you are regularly in contact.

 

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The opinions expressed on this blog are those of the author and are not to be construed as legal advice.

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