IRA to spur renewable additions in US to 110 GW/year
Solar park in Virginia. Image by: RWE AG.
The annual renewable energy deployments in the US are projected to almost triple over the next ten years, reaching 110 GW mainly thanks to the Inflation Reduction Act (IRA), but more would be needed to address climate change, according to Wood Mackenzie.
The analyst firm’s vice chairman, power and renewables Chris Seiple highlighted the positive effect of the country’s landmark IRA, which is seen as a major driver for the economic competitiveness of the renewable energy industry. He pointed out that the policy has made renewables very competitive with other technologies and led to a rush for development sites and a resurgence in manufacturing.
Regardless of the general positive sentiment, however, major challenges have occurred hand in hand with the IRA passage, mainly related to interconnection issues, available transmission capacity and labour shortages, along with extreme weather conditions. “There are solutions available now that can help alleviate current issues, but they are not getting traction fast enough,” said Seiple, adding: “As we work through these challenges, we project that the IRA will significantly reduce carbon emissions and result in a 60% carbon-free power sector by 2032, which is progress, but not enough to put us on track to limit the extent of climate change sufficiently.”
The total costs for IRA tax credits through 2050 are estimated to be some USD 1.9 trillion (EUR 1.77 tr), Wood Mackenzie estimates.
Veselina Petrova is one of Renewables Now's most experienced green energy writers. For several years she has been keeping track of game-changing events both large and small projects and across the globe.