UPDATED INFLATION REDUCTION ACT MODELING USING THE ENERGY POLICY SIMULATOR

The Inflation Reduction Act (IRA) is projected to reduce U.S. greenhouse gas emissions by 37% to 43% below 2005 levels by 2030, significantly closing the gap toward the U.S. Nationally Determined Contribution (NDC). While oil and gas leasing provisions may increase global emissions by 17 to 29 MMT CO2e, these are heavily offset by other IRA provisions. The legislation is expected to create up to 1.3 million jobs, prevent up to 4,500 premature deaths from air pollution, and increase U.S. GDP by 0.65% to 0.77% by 2030.

• The IRA is projected to reduce U.S. greenhouse gas (GHG) emissions by 37% to 43% below 2005 levels by 2030, compared to a 25% reduction under a business-as-usual (BAU) scenario.
• The IRA is estimated to close between 49% and 71% of the emissions gap between the BAU scenario and the U.S. NDC goal of 50% to 52% below 2005 levels by 2030.
• The share of clean electricity generation in the U.S. is projected to increase from 49% in the BAU scenario to between 72% and 85% by 2030 under IRA scenarios, with cumulative solar and wind capacity reaching 795 GW to 1,053 GW.
• Oil and gas leasing provisions in the IRA could increase global emissions by 17 to 29 MMT CO2e by 2030, but these are offset by other provisions at a ratio of at least 28 tons of avoided emissions for every one ton generated by leasing.
• The Methane Emissions Reduction Program (MERP) is projected to reduce emissions by 29 MMT CO2e by 2030, though its impact is limited because only 39% of emitters are covered by the program's reporting thresholds.
• The IRA is expected to provide significant public health benefits by 2030, including avoiding 2,900 to 4,500 premature deaths and 76,000 to 119,000 asthma attacks annually.
• The legislation could create between 1.2 million and 1.3 million net new jobs by 2030, primarily in the service, manufacturing, trade, and construction sectors.
• The IRA is projected to increase U.S. GDP by 0.65% to 0.77% in 2030 and result in annual household energy savings of $79 to $80 per year by 2030.
• Industrial carbon capture potential is projected to increase by 17 to 19 MMT by 2030 relative to 77 MMT under BAU, with growth concentrated in natural gas processing and the chemicals and refining industries.

APA

MAHAJAN, M., ASHMOORE, O., RISSMAN, J., ORVIS, R., & GOPAL, A. (2022). UPDATED INFLATION REDUCTION ACT MODELING USING THE ENERGY POLICY SIMULATOR. Energy Innovation. https://energyinnovation.org/wp-content/uploads/Updated-Inflation-Reduction-Act-Modeling-Using-the-Energy-Policy-Simulator.pdf

Chicago

MAHAJAN, MEGAN, OLIVIA ASHMOORE, JEFFREY RISSMAN, ROBBIE ORVIS, and ANAND GOPAL. UPDATED INFLATION REDUCTION ACT MODELING USING THE ENERGY POLICY SIMULATOR. Energy Innovation, 2022. https://energyinnovation.org/wp-content/uploads/Updated-Inflation-Reduction-Act-Modeling-Using-the-Energy-Policy-Simulator.pdf.

Wikipedia

{{cite report |last1=MAHAJAN |first1=MEGAN |last2=ASHMOORE |first2=OLIVIA |last3=RISSMAN |first3=JEFFREY |last4=ORVIS |first4=ROBBIE |last5=GOPAL |first5=ANAND |title=UPDATED INFLATION REDUCTION ACT MODELING USING THE ENERGY POLICY SIMULATOR |publisher=Energy Innovation |date=23 August 2022 |url=https://energyinnovation.org/wp-content/uploads/Updated-Inflation-Reduction-Act-Modeling-Using-the-Energy-Policy-Simulator.pdf |access-date=17 August 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{mahajan2022updated, author = {MAHAJAN, MEGAN and ASHMOORE, OLIVIA and RISSMAN, JEFFREY and ORVIS, ROBBIE and GOPAL, ANAND}, title = {{UPDATED INFLATION REDUCTION ACT MODELING USING THE ENERGY POLICY SIMULATOR}}, institution = {Energy Innovation}, year = {2022}, month = aug, url = {https://energyinnovation.org/wp-content/uploads/Updated-Inflation-Reduction-Act-Modeling-Using-the-Energy-Policy-Simulator.pdf}, urldate = {2026-08-17}, note = {Indexed by Climate Insights Directory} }