Will the Inflation Reduction Act reduce the cost of clean energy for utilities? Yes, by a lot
The IRA will cause double-digit percentage declines in the cost of clean energy across a range of technologies, creating major implications for utilities.
What’s in the Inflation Reduction Act (IRA) for utilities? In short, a spate of incentives that have the potential to supercharge clean energy development. We computed the levelized cost of energy (LCOE)—the average cost of electricity generation over the lifetime of a facility—for various technologies in 2030 with and without the IRA under a range of assumptions. The result?
All the technologies we analyzed see double-digit percentage declines in their LCOEs relative to their pre-IRA counterparts, including solar (35%), wind (49%), and green hydrogen (67%).
Read our IRA impacts paper to find out what our clean energy cost projections mean for utilities and how they can prepare for the Inflation Reduction Act.