New Delhi: The U.S. Senate Democrats on Sunday passed a $430 billion bill intended to fight climate change by reducing greenhouse gas emissions and investing in renewable energy sources.
After a marathon, 27-hour weekend session of debate, the Senate approved the legislation known as the “Inflation Reduction Act” by a 51-50 party line vote. Vice President Kamala Harris cast the tie-breaking ballot.
According to experts, if the bill is signed into law, it will be formally known as the Inflation Reduction Act, and would allocate $369 billion to reducing greenhouse gas emissions and investing in renewable energy sources.
Experts have estimated that the climate provisions of the bill will reduce America’s emissions by about 40 percent by 2030, compared with 2005 levels.
The current policy of the US restricts the country’s ability to reduce its emissions by 24 to 35 percent, whereas under the US Paris agreement the reduction targets were set at 50 to 52 percent from the level of 2005.
The bill will be sent to the House of Representatives for a vote, likely on Friday when representatives plan to reconvene briefly during a summer recess. They are expected to pass it, which would then send the bill to the White House for Biden’s signature.
The bill includes tax credits for clean energy development that will help with the high upfront costs.
As per the bill, a new $27 billion “clean energy technology accelerator” will be created to help advance renewable technologies under which households could receive up to $7,500 in tax credits to buy an electric car, and $4,000 for a used car.
There will also be $60bn given to communities that have suffered the most from fossil fuel pollution.
President Joe Biden, who has called the bill “historic”, has pledged to return the US to the international stage on climate action. In April last year, he pledged to slash US greenhouse gas emissions by at least 50% by 2030.
He announced that $2.2 billion would be used to help build infrastructure that can withstand extreme weather and natural disasters.
The bill also includes a number of tax provisions to cover the costs of these policies, bringing in $739bn for the government and resulting in an overall deficit reduction of roughly $300bn.