Taking Climate Action at the Local Level: Harnessing the Power of the Inflation Reduction Act

Welcome! Today, we're diving into the incredible world of local government and how the Inflation Reduction Act (IRA) is revolutionizing the landscape of climate action . As our world becomes increasingly urbanized, cities, counties, towns, and tribal nations are stepping up to lead decarbonization and climate adaptation efforts. In this post, we'll explore why local governments are the game changers in climate action and how the IRA is transforming their ability to lead change.

The Shift to Local Action

Back in 2007, when the IPCC released its 4th Assessment Report, the focus was largely on national action to combat climate change. However, by the time the 5th Assessment rolled around in 2014, it became evident that cities and local governments played an essential role in the climate discussion. The US's withdrawal from the Paris Agreement in 2017 was a turning point that made us realize the urgency for non-federal action. Non-federal entities, including local governments, businesses, and individuals, demonstrated that they could lead change at the most grassroots level of government.

The Game-Changing Inflation Reduction Act (IRA)

With the historic passage of the Inflation Reduction Act, state and local leaders now have an unprecedented opportunity to drive climate action. The IRA is the largest investment in climate and energy in American history, authorizing approximately $370 billion in spending in federal funding and tax credits. What makes this act a true game changer is its innovative approach to tax credits for non-taxable entities like cities. Previously, tax-exempt organizations couldn't benefit directly from tax credits due to their lack of tax liability. However, the IRA's provisions open up new opportunities for cities and municipal entities to receive direct payments from the federal government, equal to the value of certain credits.

Seizing the Opportunity: Resources for Local Leaders

To make the most of this transformative opportunity, local leaders need to understand what the IRA offers and how to capitalize upon it. That's where these incredible resources come in:

1. US Conference of Mayors Report: The US Conference of Mayors offers a comprehensive report that delves deep into the Inflation Reduction Act and its implications for government leaders. The report features case studies of projects implemented by local governments and tax-exempt entities, showcasing the benefits of the IRA in action. If you need proof of concept, this report is a must-read.

Rocky Mountain Institute's IRA Tool: Rocky Mountain Institute (RMI) has developed an interactive tool that breaks down the funding opportunities provided by the IRA. This sortable and filterable table enables state and local governments, tribal nations, businesses, non-profits, and individuals to easily identify relevant IRA programs and tax incentives.

Trickle-Up Climate Action: The Power of Bottom-Up Policy Diffusion

At Salusterra, we believe that the power of local action extends beyond its immediate impact. Our report, "Bottom-Up Policy Diffusion: A Transformative Approach to Climate-Oriented Policy Change," highlights the potential for local action to influence higher levels of government. When cities and communities lead the way with sustainable infrastructure and renewable energy integration, their successes can inspire and drive policy change at the state and federal levels.

Let's not wait for others to lead the way. The Inflation Reduction Act presents an unprecedented opportunity for local governments to make a real difference in the fight against climate change. By leveraging the resources provided by the US Conference of Mayors and Rocky Mountain Institute, local leaders can pave the way for a greener, more sustainable future. Together, we can create positive change and drive towards a more equitable and vibrant world, one community at a time.

If you're interested in learning more about the potential for bottom-up policy diffusion, check out our report "Bottom-Up Policy Diffusion: A Transformative Approach to Climate-Oriented Policy Change" on Salusterra.org. Stay tuned for more exciting insights and let's continue this important climate conversation together!