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We’re leading an all-out national mobilization to defeat the climate crisis.

Join our work today to help us build a thriving and just clean energy future. 

Everything You Need to Know About Implementing the IRA’s Most Important Programs

Our work isn’t done yet. Here’s how we take key programs from the Inflation Reduction Act and put them into action.

Passing the Inflation Reduction Act (IRA) ushered in the largest investments in climate and clean energy in our nation’s history. But our work isn’t done yet.

Effective and equitable implementation will be key to ensuring we realize our climate goals, cut greenhouse gas pollution, advance environmental justice, and create good-paying jobs that propel the clean energy economy. In order to assist federal agencies, states, local communities, Tribal governments, businesses, and other partners to take full advantage of this historic funding, Evergreen has put together explainers that break down key programs in the IRA.

Last updated May 29, 2024

 What You Need to Know  

Get the Breakdown on These Vital Programs

48C Tax Credits: $10 billion 

If you are a manufacturer looking to expand advanced energy products, check out the IRA’s revamped 48C tax credit.

The Qualifying Advanced Energy Project Credit (also known as the 48C credit) is a powerful tool that injects $10 billion in tax credits into transforming American industry by investing in decarbonization and building out a thriving and equitable clean energy economy. 

What sets the 48C tax credit apart? Nearly half of the awarded funds are earmarked for communities historically harmed by polluting industries, known officially as “energy communities.” Plus, in order to get the full 30 percent tax credit, applicants need to offer prevailing wages and apprenticeship programs.

GET THE DETAILS →

 

Environmental and Climate Justice Block Grants: $3 billion

This first-of-its-kind $3 billion federal program aims to empower disadvantaged communities to determine and design their own visions of pollution reduction and clean energy investment. It does so by providing highly flexible funding that goes directly to nonprofit organizations serving disadvantaged communities—meaning projects are designed by and for communities to address their unique needs and build resilience and political capacity.

GET THE DETAILS →

 

Clean Energy Tax Credits: $125 billion - $570 billion in investment 

If you are a clean energy producer or project developer, check out the IRA’s new and improved clean energy tax credits.

Complex, but packing a big punch, tax incentives for clean electricity development represent a significant portion of the investments within President Biden’s landmark climate bill. The Investment Tax Credit (ITC) subsidizes clean energy development and installations while the Production Tax Credit (PTC) pays for the generation of clean energy. Both tax credits are accessible via direct pay to make them easier to monetize and receive a boost if projects follow high-road labor standards. 

These tax credits are powerful tools in the clean energy transition, boosting the installation and operation of new clean power sources and specifically targeting investments in marginalized and underserved communities.

GET THE DETAILS →

 

Climate Pollution Reduction Grants:  $5 billion

If you need flexible funding to tackle climate pollution in your state or community, check out the IRA’s Climate Pollution Reduction Grants.

One of the most important yet frequently overlooked programs in the IRA is the Climate Pollution Reduction Grants (CPRG) program, designed to empower state, local and Tribal leadership to take bold climate action and reduce pollution The CPRG dramatically boosts the effectiveness of subnational efforts,  providing incentives to seize these opportunities and leverage greater public and private sector investments in climate solutions.

GET THE DETAILS→ | DOWNLOAD STATE GUIDANCE→

 

Greenhouse Gas Reduction Fund: $27 billion

If you need low-cost financing for clean energy projects, especially in disadvantaged communities, check out the Greenhouse Gas Reduction Fund.

Providing a massive $27 billion in grants, the Greenhouse Gas Reduction Fund (GGRF) is the largest grant program within the IRA–with the shortest timeline for EPA to spend the money. Not only does this program provide a massive investment in pollution-reducing clean energy technology, it also targets communities that have been historically overlooked and underserved and brings equity to the clean energy transition. 

GET THE DETAILS→ |  DOWNLOAD STAGE GUIDANCE→

 

Rural Utilities Service Programs: Nearly $11 billion 

If you are a rural electric cooperative or another entity looking to deliver clean power to rural communities, check out USDA’s New ERA and PACE programs. 

There are significant opportunities to unlock emissions reductions in rural areas, which have—in many states—been slow to adopt clean energy. In May 2023, the United States Department of Agriculture (USDA) announced these two new programs that will spark a clean energy transformation across rural America, U.S. territories, and freely associated states.

Made possible by the IRA, these programs are known as the $9.7 billion Empowering Rural America (New ERA) program, which will provide funding to rural electric cooperatives for clean energy, and the $1 billion Powering Affordable Clean Energy (PACE) program, which provides funding for partially-forgivable loans to a larger eligibility pool for renewable energy projects. Together, these programs will provide $10.7 billion to help rural communities transition to clean, affordable, and more reliable energy systems.

GET THE DETAILS →

 

Direct Pay (aka Elective Pay): No Overall Limit 

If you are part of a government entity (including state, local, and Tribal) or tax-exempt organization (including 501(c)3 and 501(d)3) that wants to develop clean energy projects, check out these tax credits. 

Everyone should be able to benefit from and support the transition to a clean energy future. But some of the most important players in the energy transition—including local governments, nonprofits, state agencies, Tribes, rural co-ops, schools, and community-based organizations—don’t pay taxes. As a result, they don’t qualify for typical tax credits. 

That’s where a key provision called direct pay (or elective pay) comes in. It expands access to tax credits beyond private businesses, allowing tax-exempt entities to qualify for the full value of the tax credit and receive it as a direct payment from the government instead of receiving the credit as a reduction of taxes paid in that year. 

How can these entities maximize elective pay credits? How do partnerships work under elective pay? How can organizations apply?

GET THE DETAILS


 

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Fact Sheets: How States Can  Implement the IRA

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Gov. Tim Walz signs the bill that puts Minnesota on the path to 100 percent clean electricity by 2040. (Source: Rep. Jamie Long on Twitter)

How can states capitalize on historic climate and clean energy funds? We’ve put together short fact sheets that make it clear how leaders in nine key states can take full advantage of all the discretionary funding in the IRA and how the programs established in this new law align with their existing climate and environmental justice strategies.

 GET THE STATE-FOCUSED FACTSHEETS 

Colorado | Maryland | Michigan | Minnesota | New Jersey | New Mexico |
Nevada | Pennsylvania | Wisconsin

 

 Related Content 

From the Experts: Tapping into the IRA’s Funding Opportunities for Tribes

Watch: Learn how Tribal governments and Indigenous organizations can take full advantage of funds in the Inflation Reduction Act to deliver the maximum benefits to their communities.

Thanks to the Inflation Reduction Act, billions of dollars are being pumped into the U.S. economy to propel the clean energy transition. Now Tribal governments and Indigenous organizations have the opportunity to take full advantage of these funds to deliver the maximum benefits to their communities. IRA programs have the power to cut pollution, lower energy costs, create jobs, and more.

Evergreen co-hosted a virtual event with NDN Collective Director of Policy and Advocacy Jade Begay and Institute for Tribal Environmental Professionals Co-Director Nikki Cooley to discuss how Tribal governments and Indigenous communities can tap into this historic funding and advance climate solutions. 

In addition to the recording above, check out three key fact sheets focused on these communities: 

Tribal Electrification Program Clean Energy Investment and Production Tax Credit Environmental and Climate Justice Block Grant Program