You are probably accustomed to hearing a lot of gloomy talk about the climate—and with good reason. Climate change threatens human lives and livelihoods at a scale perhaps unmatched by any other issue short of global thermonuclear war, and governments haven’t come anywhere close to adequately addressing it despite decades of efforts.
The climate investment deal announced by West Virginia Senator Joe Manchin and Senate Majority Leader Chuck Schumer this week may change that. If it passes, the so-called Inflation Reduction Act will be the most significant U.S. climate legislation of all time with $385 billion in spending aimed at changing the way America powers itself. It would foster the rapid deployment of renewable energy, invest in future technologies, and support consumers who embrace a clean energy future. “This is the package that we have been waiting for,” says Leah Stokes, a professor of environmental politics at the University of California Santa Barbara who has been a key advocate for robust climate policy. “This is a transformative bill.”
The effects of those measures could spread beyond the U.S. By helping put President Joe Biden’s emissions-reductions goals within reach, the bill could send a signal around the globe that the U.S., the world’s largest economy, remains committed to tackling climate change. At a time when crisis after crisis has pushed climate change off the agenda in many capitals, the legislation could shift the world to a different climate course.
To understand why this legislation matters, it’s important to understand the urgency of climate change. Scientists have said that when the planet warms somewhere between 1.5°C and 2°C over pre-industrial levels the world is likely to experience a series of catastrophic effects, including irreversible tipping points—think of the collapse of the Greenland ice sheet or the thawing of permafrost that stores greenhouse gases. That could drive a rapid acceleration in the effects of climate change, from a quick rise in sea levels to a hastening of the rise in temperatures.
The planet has already warmed about 1.2°C, and so to have a good chance of forestalling 1.5°C of temperature rise humans need to cut emissions quickly by about 45% by 2030 from 2010 levels and cut them entirely in the second half of the century. At the start of his presidency, Biden laid out goals to align with that scientific consensus. He promised to cut U.S. emissions in half from 2005 levels by 2030 with the goal of hitting net zero emissions by 2050.
But eight years moves very quickly in the world of energy; infrastructure built today lasts decades. And, as Biden gets close to wrapping the first two years of presidency, it was looking increasingly likely that the U.S. would miss his target by a wide margin. An analysis from the Rhodium Group published in mid-July found that greenhouse gas emissions in the U.S. were set to fall 24% to 35% from 2005 levels by 2030.
The Inflation Reduction Act, if it becomes law, would go a long way to making up that gap. It’s chock full of measures that on their own would play a significant role bringing down emissions. The most obvious center on the technologies that have become synonymous with clean energy: electric vehicles and renewable energy. The legislation includes an extension of tax credits for producing electricity from wind farms and solar panels and adds new technologies to the list including geothermal and so-called advanced nuclear. In the past, the tax credits lasted for a year or two, creating a seemingly perpetual debate about whether Congress should extend them and making it hard for investors to count on the measures. The credits in the new legislation last 10 years.
The electric vehicle provision would give consumers up to $7,500 in tax credits for the purchase of a new EV. Previous EV tax incentives capped the number of consumers who could receive the credit; this time around the program lasts for a decade without a cap.
Beyond the headline tax incentives, the legislation includes a range of carrots and sticks that climate advocates have been pushing for years. The law would set up a fee on methane leaks that penalizes leaks from oil and gas infrastructure. It would provide consumers with tax incentives for installing equipment that makes their homes more efficient—think of rooftop solar, heat pumps, and more efficient heating and cooling systems. Billions would be spent to foster clean energy manufacturing in the U.S. Billions more would be authorized to help promising climate technology companies get off the ground. The list goes on.
It all adds up to enough to keep Biden’s climate targets alive. In the hours after news of the compromise broke, Schumer’s office estimated that the bill would drive down U.S. emissions 40% by 2030. Independent analysts are still crunching the data, but said in the hours after the news broke that they expected Schumer’s estimate to hold up. When combined with executive action, state initiatives, and private sector commitments, Biden’s 50% goal quickly comes within reach.
Not everyone is over the moon about the legislation. Environmental groups have criticized the legislation for advancing oil drilling on federal land, among other provisions that give fossil fuels a future in the energy mix. And Senate Minority Leader Mitch McConnell has promised that Republicans will do everything in their power to stop it, calling it a package of “job-killing tax hikes, Green New Deal craziness.” It remains to be seen whether Schumer and House Speaker Nancy Pelosi can muster the near total Democratic unity in Congress that will be required to pass the bill into law.
One of the key Republican arguments deployed against U.S. climate programs is that action from the U.S.—which is responsible for less than 15% of global emissions—alone cannot meet the world’s climate targets. This is true, of course. But, in order to have credibility in pushing other countries to stem their emissions, the U.S. needs to show the world that it’s working to do that at home. The Inflation Reduction Act isn’t the only way the U.S. could convince the rest of the world that it remains serious. But, at this hour, it’s the country’s best shot.
More Must-Read Stories From TIME