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Guide Details IRA Support for Climate Resilience, Emissions Reduction

The Office of Climate Change and Health Equity (OCCHE) released a new navigational tool, the OCCHE Quickfinder for Leveraging the Inflation Reduction Act (IRA) for the Health Sector, to help health care stakeholders find opportunities for resilience and emissions reductions in the Inflation Reduction Act (IRA).

This new tool supplements the Building a Clean Energy Economy: A Guidebook to the Inflation Reduction Act’s Investments in Clean Energy and Climate Action, highlighting the most relevant opportunities for the health sector in the IRA.

The Quickfinder provides an overview of investments and actions to reduce emissions and invest in climate resilience, along with IRA programs or initiatives that might support them in:

  • Investing in onsite, renewable energy generation.
  • Energy efficiency building improvements.
  • Transportation.
  • Increased building resilience.
  • Increased community resilience.

The Quickfinder also provides greater detail on specific IRA programs, including tax incentives and direct pay provisions, grants and incentives for lowering emissions, and grants and incentives for climate resilience.

Tax Incentives and Direct Pay Provisions

The IRA changed the tax code to allow health sector stakeholders to receive tax credits and direct payments for clean energy projects. Using these credits, a provider can make investments in energy generation equipment, energy efficiency, commercial clean vehicles, and vehicle refueling. Tax-exempt organizations can still benefit from many of these opportunities through direct payment, though some details regarding eligibility and requirements are forthcoming.

Energy Generation Incentives include:

  • Production Tax Credit for Electricity from Renewables.
  • Investment Tax Credit for Energy Property.
  • Increase in Energy Credit for Solar and Wind Facilities Placed in Service in Connection with Low-Income Communities.
  • Clean Electricity Production Tax Credit
  • Clean Electricity Investment Tax Credit.

Energy Efficient Commercial Buildings Deduction is a tax deduction for energy efficiency improvements to commercial buildings starting in 2023, with no expiration date. Credit for Qualified Commercial Clean Vehicles is a tax credit for purchasers of qualified commercial clean vehicles for vehicles placed in service in 2023 and acquired before 2033.

Alternative Fuel Vehicle Refueling Property Credit provides a tax credit for alternative fuel vehicle refueling and charging property in low-income and rural areas.

Grants and Incentives for Lowering Emissions

Providers can leverage these programs to invest in zero-emissions or low-emissions energy generation:

  • The Rural Energy for America Program (REAP) provides guaranteed loan financing and grant funding to agricultural producers and rural small businesses for renewable energy systems or to make energy efficiency improvements.
  • The Greenhouse Gas Reduction Fund provides competitive grants to mobilize financing and leverage private capital for clean energy and climate projects that reduce greenhouse gas emissions, emphasizing projects that benefit low-income and disadvantage communities.

Grants and Incentives for Climate Resilience

The IRA includes investments in climate resilience across a wide variety of climate hazards. This is an opportunity for providers to seek federal support for investments that will help facilities stay functional and safe during an emergency or in the face of extreme weather events.

Grants and assistance include:

  • Environmental and Climate Justice Block Grants, which provide grants and technical assistance to community-based organizations, alone or in partnerships, to reduce air pollution; monitor for pollution; improve community resilience to the impacts of climate change; and build the capacity of these organizations to engage with state and federal decision-making processes. Local governments and institute of higher education can partner with community-based nonprofit organizations for these grants.
  • Robert T. Stafford Disaster Relief and Emergency Assistance Act. The IRA authorizes the Stafford Act to provide financial assistance for costs associated with low-carbon building or construction materials and incentives to encourage these projects.
  • The Climate Pollution Reduction Grants Program will provide grants to states and local governments to develop and implement plans for reducing greenhouse gas emissions and other air pollution. Health stakeholders are not eligible for such grants, unless an organization is part of a municipality or other eligible entity. However, sub-awards can be given to nongovernmental organizations and academic institutions.

Contact Senior Director of Policy Erin O’Malley at eomalley@essentialhospitals.org or 202.585.0127 with questions.

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About the Author

Julie Kozminski is a senior policy analyst at America's Essential Hospitals.

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