With U.S. President Joe Biden signing the Inflation Reduction Act (IRA) into law last week, the U.S. will soon reach parity with other developed nations’ climate budgets, reports the Atlantic Council. The IRA makes $368 billion in funding available for climate and energy reform over the next decade — making it the largest clean energy investment in U.S. history.
In the shorter term, the new legislation allocates $130 billion through 2025. That increases domestic spending on climate adaptation from 0.6% of the U.S. total gross domestic product to 1.2%. This places the U.S. between the U.K. and the EU in climate mitigation funding, which spend 0.97% and 1.38% of their GDP, respectively. (These calculations are based on budget commitments to energy spending between 2022-2025.)
The bill could reduce U.S. greenhouse gas emissions by 31 to 44% from 2005 levels by 2030, though that falls short of President Biden’s original goal to cut emissions by 50%.