Inflation Reduction Act signed into law

On Aug. 16, President Biden signed the Inflation Reduction Act (IRA) of 2022. This legislation provides numerous incentives to advance energy innovation, including tax credits for transmission grid modernization, renewables, carbon capture, battery storage, and other energy technologies.

The IRA also authorizes direct pay of energy tax credits. This provision allows electric cooperatives to monetize production tax credits without the use of a for-profit entity. In addition to tax incentives, the IRA provides $9.7 billion in financial assistance to electric cooperatives for the purchase of renewable energy, installation of carbon capture technology, or deployment of zero-emission energy systems.

These new and expanded incentives provide many options to help Basin Electric further diversify its portfolio, reduce emissions, and maintain reliability while providing affordable rates to its members.

“The direct pay provision in the IRA allows us to compete on a level playing field to deploy renewable energy or other technologies to reduce emissions from new and existing generation sources,” said Tyler Hamman, Basin Electric vice president of Government Relations.

Basin Electric is currently analyzing the potential impacts and opportunities this law will provide to help deliver value to its membership.

“Basin Electric has a long history of environmental stewardship while keeping reliability and affordability top of mind for our members,” said Hamman. “It’s never perfect when a piece of legislation like the IRA gets packaged together, but the energy provisions are policies that the cooperative family has advocated for a long time and are generally a net-win for cooperatives and Basin Electric.”

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