The bill, which will extend the wind production tax credit (PTC) for 10 years, had been passed by the House of Representatives on Friday (12 August). The legislation will also extend the investment tax credit (ITC), often used by offshore wind projects, by a decade.
The law is a compromise measure. Biden had proposed a far larger bill, dubbed build back better, which died. Then in late July, in a surprise compromise Senate Democrats reached a deal on a spending plan in what was described as an “11th hour reprieve.”
Renewable energy tax credits remained in the compromise IRA.
The Inflation Reduction Act (IRA) will also create advanced manufacturing tax credits which can support the domestic production and sale of major wind components such as nacelles and blades.
After signing the bill into law in a ceremony at the White House, Biden said: “This bill is the biggest step forward on climate ever.”
Overall, the IRA authorises $369 billion in funding for climate change and clean energy initiatives. It is projected to reduce US carbon emissions by 40% by 2030.