Page 31 - Inflation-Reduction-Act-Guidebook

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Revitalizing American Manufacturing to Build the

Clean Energy Economy

Implementation of the Inflation Reduction Act presents an historic opportunity to advance
America’s economic and foreign policy objectives. As we invest billions of dollars to accelerate
deployment of clean energy technologies across the country, the Administration is committed to
designing programs that boost domestic manufacturing, create good-paying jobs, and reduce the
country’s dependence on foreign nations for critical components of the clean energy supply
chain. President Biden made a promise to re-energize American manufacturing, and the Inflation
Reduction Act makes good on that promise.

Funding Overview

The Inflation Reduction Act includes several funding and tax programs to boost domestic
manufacturing of clean energy technologies and create good-paying manufacturing jobs that
have staying power, including for those who are historically underrepresented in this field.
Highlights include:

• Up to $250 billion in new loan authority for Energy Infrastructure Reinvestment
Financing. The Inflation Reduction Act provides the Department of Energy with $5
billion in credit subsidy to support up to $250 billion in new loan authority to guarantee
loans to projects that retool, repower, repurpose, or replace energy infrastructure that has
ceased operations or that enable operating energy infrastructure to avoid, reduce, use, or
sequester greenhouse gases. This new program could support a variety of projects, such
as building clean energy facilities on former coal mining sites, reconductoring
transmission lines, or updating operating energy facilities with pollution control
technologies. This program could offer particular benefits to energy communities.

• Extension and Expansion of the Advanced Energy Project Credit. The Inflation
Reduction Act provides the Secretary of the Treasury with new authority to allocate $10
billion to projects that (1) re-equip, expand, or establish an industrial or manufacturing
facility for the production or recycling of a range of renewable energy and energy
efficiency equipment, carbon capture equipment, and advanced vehicles; (2) re-equip an
industrial or manufacturing facility with equipment designed to reduce greenhouse gas
emissions by at least 20 percent; or (3) re-equip, expand, or establish an industrial facility
for the processing, refining, or recycling of critical materials. The law requires the
Secretary of the Treasury to set aside 40 percent of the qualified investments for projects
in energy communities where a coal mine or coal-fired electric generating unit has
closed.

• A new Advanced Manufacturing Production Credit. The Inflation Reduction Act
creates a new production tax credit for domestic manufacturing of components along the
supply chain for solar modules, wind turbines, battery cells and modules, and critical
minerals processing.

26 B U IL D IN G A C L E A N E N E R G Y E C O N O MY
G U ID E B O O K | J AN UARY 20 2 3 | VE RS I O N 2