3. IRA

Question 1

What is the U.S. rank in global greenhouse gas emissions?

Answer 1

Second-largest emitter with 5.96 GtCO2e, 11.2% of global total

Data is from 2023 (EDGAR from 2024)

Question 2

What percentage of total emissions in the U.S. are energy-related?

Answer 2

Over 90%

This highlights the significant contribution of energy production to overall emissions.

Question 3

What is the U.S. target for reducing emissions by 2030? And then?

Answer 3

Around 50% below 2005 levels

The goal is part of a broader commitment to reach net zero by 2050.

Question 4

What was the U.S. spending on energy transition in 2024?

Answer 4

About $338 billion

This amount was flat compared to the previous year.

Question 5

What are the three main policy focuses of the IRA?

Answer 5

• Industrial policy
• Climate policy
• Trade policy

The IRA is not related to inflation despite its name.

Question 6

What significant trend occurred in U.S. power generation history?

Answer 6

Shift to lower-emissions sources has been underway for decades

Contributions from nuclear and fossil gas have been notable.

Question 7

What is the cost advantage of larger nuclear reactors built in the U.S.?

Answer 7

One-third advantage versus smaller plants in costs per kilowatt

This is according to the U.S. Department of Energy.

Question 8

How much clean energy spending is planned in the U.S. from 2022 to 2027? Explain federal spending

Answer 8

Over $500 billion

This amount represents about 0.3% of U.S. GDP.

Question 9

Type and sector of IRA measures?

Answer 9

Tax credit/grand/loan – energy, environmental, buildings, transport, few carbon removals

Question 10

Which renewables is the best for US?

Answer 10

Solar, big momentum

These installations are crucial for decarbonization efforts.

Question 11

What is a key difference between the U.S. IRA and the EU’s approach to climate financing?

Answer 11

• IRA does not create funds or rely heavily on debt financing
  (NB: less gov tax collection)
• existing resources reallocate (discard old projects)
• no influence in inflation
• rely on tax breaks
• no mandatory targets

The EU primarily uses government debt to finance its initiatives.

Question 12

What was the trend in U.S. greenhouse gas emissions in 2024 compared to the previous year? And GDP?

Answer 12

Nearly unchanged, down by just 0.2% year-on-year. But decoupling with GDP (always less than 2005 levels)

This occurred while the economy grew by 2.7%.

Question 13

What has been the impact of the Trump administration on climate finance investments? Most important dinamics? And which is the consequences of tariffs?

Answer 13

The impact is still uncertain as of Q1 2025
- tariff, tax credit uncertainty, EV demand
- tariff: higher cost, less US battery imports, slow EV penetration, and affect manufacturers in EU

The IRA has catalyzed unprecedented investment, but future demand remains uncertain.

Question 14

What challenges do U.S. clean technology manufacturers face in the current climate?

Answer 14

• Shifting policy environment
• Tariff policies
• Demand uncertainty

These factors may affect the pace of clean technology development.

Question 15

True or False: The Inflation Reduction Act establishes meaningful targets for industries.

Answer 15

False

The IRA is heavily reliant on tax breaks without imposing targets.