Reflections on One Year of IRA Implementation
One year ago, on August 16, 2022, President Joe Biden signed the Inflation Reduction Act (IRA) into law, marking the most significant Congressional action on climate change and clean energy in the country's history. Amidst the hottest June ever recorded, devastating wildfires and their associated air pollution, historic precipitation, flooding, and ocean warming, IRA's one-year anniversary offers an opportunity to reflect on this moment in time, the progress to-date implementing its many programs, and the potential it has to advance our mission and benefit the communities we serve in the months and years ahead.
As the country absorbed the surprising passage and significance of IRA's investments in climate and energy-related programs, it became clear that they hold the potential to have transformative impact on many sectors of the US economy. Many IRA programs have a strong emphasis on decarbonization of buildings since more than 40 percent of global greenhouse gas emissions are connected to the built environment, creating a huge opportunity for the affordable housing sector. These investments are intended to create domestic green jobs, support the economy, and reignite American manufacturing, all while addressing the climate crisis.
Importantly, these resources intentionally aim to benefit communities and people with low incomes that historically have been disproportionately impacted by climate change, representing many of the people and communities HPN members serve. It is critical that climate solutions also advance through a justice framework. This aligns with the Administration’s requirements that the IRA program investments meet environmental and economic justice priorities. Greening the affordable housing sector simultaneously advances emissions reduction and climate justice goals.
"I continue to believe that IRA will address some of the inequities that marginalized communities have experienced in their efforts to build and maintain environmental sustainability. I hope that IRA supports not only electrification and carbon footprint reduction, but also equity, environmental social justice and inclusive access to funding."Donna Moodie Community Roots Housing
HPN members represent many of the most innovative affordable housing nonprofits in the country taking steps to lead on decarbonization and bringing cleaner, healthier, and more resilient housing to historically underserved communities. Members have already created innovative solutions to community solar, energy and water efficiency, and sustainable financing, but have never had a dedicated source of capital to pursue these goals at scale. With the complex capital structures and unique considerations of affordable housing, our sector has been deeply engaged in shaping these programs to ensure their potential benefits are realized.
Robin Hughes, HPN CEO, reflects that “the IRA represents an important moment for the country and the affordable housing sector. This historic investment offers the resources needed to invest in improvements that will reduce greenhouse gas emissions and increase the health and resiliency of housing, helping the communities we serve become greener and healthier places to live, work, and thrive. HPN is grateful that the IRA legislation and EPA are prioritizing investments that benefit low-income and disadvantaged communities and sees affordable housing as a key strategy to achieving its climate goals.”
"As we commemorate the first anniversary of President Biden's signing of the Inflation Reduction Act (IRA), there is positive news for affordable housing providers and residents. Federal agencies have diligently worked to develop the necessary guidelines to implement IRA's programs. Advocates like NHT have remained engaged at every juncture, advocating for policies that ensure IRA benefits reach low-income communities. The progress made is worth celebrating."Todd Nedwick National Housing Trust (NHT)
Under Robin’s leadership, HPN has focused on ensuring sector access to the EPA Greenhouse Gas Reduction Fund (GGRF), a $27 billion program intended to establish long-term national financing institutions to invest in emission-cutting infrastructure and technologies and build the green financing capacity of community lenders such as CDFIs. HPN members and peer organizations, working together, have helped inform, interpret, and communicate programs beyond the GGRF, including HUD's Green and Resilient Retrofit Program, Treasury's solar investment tax credits, and DOE's equipment rebate programs. You can access HPN comment letters to EPA and its Environmental Finance Advisory Board regarding the GGRF program design here.
"My team and I are taking advantage of the adjustment to the rules around layering LIHTC and the solar ITC, and we certainly appreciate the Act’s emphasis on increasing the feasibility of including renewable energy generation in affordable housing developments. Overall, we are excited about the new programs and historically significant funding that will be coming to advance the related goals of increasing the supply of quality, energy-efficient affordable housing and reducing greenhouse gas emissions in the residential sector."Patrick Hess Avesta Housing
The scale and ambition of IRA is historic, yet these programs alone are not expected to achieve the decarbonization required for the United States to meet its climate goals. The IRA, however, may be the catalyst that drives public engagement, private sector investment, additional state and local action, and technological innovations and social change that will help us realize the nation's climate goals. With the resources already available through the IRA and increased engagement from the sector it is clear that positive change is well underway. While there is substantial work ahead, HPN understands the potential of this moment and is committed to engaging with its members and sector partners to ensure the full vision of the GGRF’s climate and equity goals are achieved.