Inflation Reduction Act Invests in Union Jobs to Cut Carbon Pollution & Lower Energy Costs

On August 16, 2022, President Biden signed into law the Inflation Reduction Act, which makes historic investments in renewable energy with strong labor standards that could create millions of union climate jobs, slash climate pollution and lower energy costs for working people.

"The Inflation Reduction Act (IRA) is a climate jobs game changer. At a moment when energy prices are sky high, it turbo charges the clean energy transition that's already under way here in Maine, and will continue to drive down renewable energy costs,” said Francis Eanes, executive director of the Maine Labor Climate Council, a coalition of unions in Maine. “For the first time, the IRA expands all of its incentives to our public and community institutions such as schools, municipal buildings, post offices, and libraries. It does all of this while strongly incentivizing high road labor standards, showing that we don't have to chose between ambitious climate goals and good union jobs.”

The IRA’s climate provisions were designed to encourage the creation of well-paying union jobs by including the following provisions:

• Powerful tax incentives for all types of renewable energy technology – from solar and wind to green hydrogen. Many of these incentives are tied directly to strong labor standards that will ensure workers on those projects are paid fairly and benefit from high-quality registered apprenticeship programs.

• Direct pay renewable tax credits to allow school districts and public entities to invest in energy efficiency upgrades and retrofits to community infrastructure, including public schools, that will lower energy costs and create union career pathways in local communities. 

• Requiring that developers who wish to take advantage of many of the IRA’s historic tax incentives to build renewable energy projects must adhere to meaningful labor standards for workers, from paying good wages and benefits to hiring a certain number of apprentices. 

• Slams the door on low-road developers and their contractors who exploit and underpay workers in the name of saving the planet.

• The largest expansion of prevailing wage in decades. The IRA will set a strong wage floor for workers on the thousands of renewable projects that will take advantage of the tax credits across the country.

• Tax credits for developers that use U.S.-made materials, which will create good jobs for workers who build solar panels, wind turbines, and electric vehicles, and the workers who produce the raw materials that go into those products. 

This unprecedented investment in the workers who will decarbonize our economy provides tremendous incentives to grow worker power, but it also means we have a lot of organizing to do to ensure that happens. If you would like to join the local labor climate movement sign up here for updates from the Maine Labor Climate Council.