NEFI’s take on Inflation Reduction Act of 2022

Written on: August 3, 2022 by ICM

The National Energy & Fuels Institute (NEFI) recently reviewed the U.S. Senate’s proposed bill—Inflation Reduction Act of 2022—which includes $369 billion in energy and climate policies. Here is the organization’s view on the proposed actions:

Good

• A provision that may result in 600 million acres of federal waters for new oil & gas production—more than four times the entire Gulf of Mexico outer-continental shelf
• $500 million for downstream biofuel infrastructure grants
• Two-year extension of the biodiesel blender tax credit, cellulosic biofuel producer credit, and propane autogas credit

Bad

• Creation of a new rebate program for electric heat pumps, albeit at a much smaller funding amount than initially proposed
• Replacement of the biodiesel blender tax credit in 2025 with a new producer credit for “clean transportation fuels”
• Creation of a sustainable aviation fuel (SAF) tax credit that may result in increased competition for biofuels

Mixed Bag

• $600 tax credits for oil boilers and furnaces that meet 2021 Energy Star criteria and are rated by the OEM for use with at least 20% biofuel blends
• $4.3 billion for performance-based energy efficiency rebates, including up to $4,000 for proven energy savings of 20%—34%

Source: https://nefi.com/news-publications/recent-news/nefi-releases-detailed-analysis-inflation-reduction-act-2022/