A new study revealed how components for renewable energy made in the U.S. are now cheaper than those brought in from other countries.
The study, called "Effects of Renewable Energy Provisions of the Inflation Reduction Act on Technology Costs, Materials Demand, and Labor," was carried out by Dartmouth and Princeton universities and was funded by the BlueGreen Alliance, an organization that works with environmental organizations and labor unions.
The study investigated the projected effects of the Inflation Reduction Act on the wind and solar sectors in the U.S. More specifically, it evaluated the consequences of two key provisions: the 45X Advanced Manufacturing Production Tax Credit (or 45X MPTC for short) and the tax credits that apply to clean electricity production and investment.
The 45X MPTC tax credits are for clean energy components produced in the U.S. — among them the PV module, batteries, and critical minerals, as reported by Electrek.
Electricity to power industries and buildings, including homes, release the largest amounts of planet-warming gases. In fact, coal, oil, and gas account for over 75% of all air-polluting gases humans produce on the entire planet.
Air pollution does more than just warm the planet. It is also terrible for human and animal health. In 2018, the burning of oil, gas, and other dirty energy sources for generating energy cost $2.9 trillion in health and economic costs, about $8 billion a day globally.
Meanwhile, the cost of electricity from solar power fell by 85% between 2010 and 2020, and renewable energy overall is today the cheapest power option in many parts of the world.
In reference to the 45X MPTC tax credit, the U.S. Department of Energy explained that "the credit varies by eligible component and is multiplied by the number of units produced by the taxpayer that were sold that year."
The Dartmouth and Princeton study also revealed that thanks to the 45X MPTC, the prices of solar panels manufactured in the U.S. using 100% domestically sourced materials have decreased by 30% compared to imported ones.
In reference to the Electrek article that covers the subject, one commenter wrote, "Tax money spent in this way will likely pay for itself in the future in avoided medical costs (avoided conventional air pollution) and avoided climate change mitigation."
Considering the $2.9 trillion spent on health and economic costs because of pollution from dirty energy sources, the tax money for renewables could go a long way in keeping Americans healthy and safe.
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