The US Approach to Clean Energy Industrial Strategy

With the recent passage of three landmark pieces of legislation—The Bipartisan Infrastructure Law of 2021 (BIL), The CHIPS and Science Act of 2022 (CHIPS), and the Inflation Reduction Act of 2022 (IRA)—the United States has joined the chorus of countries utilizing ‘industrial strategy’ to catalyze clean energy deployment and combat climate change. But unlike those before, the US approach stands alone in its precision, emphasizing smart investment rather than sheer volume. BIL, CHIPS, and IRA have been strategically designed to mobilize focused and effective private investment in key industries. Already, this targeted approach has spurred over half a trillion dollars of private investment across dozens of industries, from solar manufacturing to hydrogen production. 

Beyond combatting climate change, well-designed clean energy industrial strategy can enhance economic and energy security, revitalize domestic manufacturing sectors and workforces, and build global competitiveness in the technologies that will define the 21st century. CHIPS, BIL, and IRA provide a valuable roadmap for European and United Kingdom contexts as they seek to address their own unique market and policy gaps.

This slide deck aims to demystify the complexities and nuances that surround recent US legislation. From tax credits to technical assistance, dozens of funding structures and policy mechanisms have been tapped to strategically target the highest impact and hardest to decarbonize areas of the US economy. Across the research, development, demonstration, and deployment (RDD&D) spectrum, this ‘private sector led, government enabled’ approach is pioneering a new clean energy era of US industrial strategy; and Carbon Free Europe is excited to communicate lessons learned across the Atlantic as the US, EU, and UK continue to design and implement their own clean energy industrial strategies.