The Inflation Reduction Act (IRA) was signed into law by President Biden on Tuesday, August 16. The IRA is a major legislative package bundling together energy/climate, healthcare, and tax provisions. Its enactment on Tuesday marked the end of well over a year of winding Congressional negotiations.  

As reported in last week’s Current, while the $740 billion package is not focused on water, many of the provisions in the bill include potential impacts to clean water via the nexus with climate change, clean energy and environmental justice. Among other provisions the law expands clean energy tax credits, increases funding for agricultural conservation incentives, expands residential and commercial energy retrofitting programs, and enacts new fees on the oil and gas industry. Solar, wind, biogas, and electric vehicle production is expected to expand due to the provisions and incentives. 

Additional focus was directed to advancing environmental justice (EJ). The EJ provisions included in IRA seek to support community-driven investment in disadvantaged areas. The bill also provides $550 million for Bureau of Reclamation projects to provide domestic water supplies to communities or households which do not have reliable access to water.  

Congress passed IRA with Democratic votes only in the 50-50 Senate, under special rules that allow passage with just a simple majority. The House passed the bill on a similar Democratic party-line vote, 220-207. IRA enactment is likely to be the last sizeable legislative action President Biden will be able to complete before the midterm elections in November.  

NACWA staff is currently reviewing the specific provisions of IRA for the impacts as well as potential POTW eligibilities. Please contact Danielle Cloutier, NACWA Legislative Director, with any questions or to discuss further.