Will IRA Grants for Building Upgrades Survive?

• Inflation Reduction Retraction: The future of sustainable building grants under the Inflation Reduction Act is uncertain as Trump moves to pause some subsidies. With a slim Republican majority in Congress, the fate of energy-efficient projects hangs in the balance.

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Will IRA Grants for Building Upgrades Survive?

One of President Trump’s campaign promises was to repeal former President Biden’s landmark legislation the Inflation Reduction Act. The bill, signed in the aftermath of the pandemic, has been called the Green New Deal and was designed to give federal grant money to a variety of sustainable initiatives including a number of different provisions aimed to incentive a transition to more sustainable building. The tax breaks and grant money has already been used by many property companies to help them build or improve their properties with energy efficient upgrades. But now with the Republicans in control of all three branches of government, the future of IRA grants for construction projects is in question. The uncertainty has left many property owners who have already applied for these programs wondering if their projects will be able to go forward without these subsidies.

So how likely is it that Trump and his GOP allies will cancel the sustainable building aspects of the IRA? Before leaving office Biden did his best to protect around 84 percent of the IRA clean energy grants, “obligating” them by signing binding contracts. But that doesn’t make them immune. Trump has already signed an executive order to pause the disbursement of funds. The White House later clarified in a memo that the order only applied to funds that contradicted the President’s agenda, including boosting domestic energy products and eliminating subsidies for electric vehicles.

Even if Trump takes aim at the energy efficiency building upgrade aid, doing so might not be popular with some of his Republican colleagues in Congress. A recent analysis ranked 32 Republican House members who have previously supported clean energy investments, have voted for environmental bills, and are in a competitive district. There were 32 House members who qualified, some of which have large sustainable energy industries in their district. Since the Republicans only hold a 3 seat majority in the House, it wouldn't take many defectors to limit Trump’s ability to dismantle the IRA. Things can change quickly in this political climate but for now, it looks like IRA subsidies for sustainable building upgrades will remain, even if the rest of the Green New Deal gets dismantled by the current administration.

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