TL/DR –
The Biden administration did not fully specify how much of the Inflation Reduction Act’s climate funds it had spent. An investigation by Politico found that about 67% of the $145.4 billion in grants were awarded, but the amount actually committed was unclear. Of the $93.4 billion allocated to more than 80 climate and environmental programs, $31.7 billion, or approximately 34%, was left unspent; however, it is unclear whether the Trump administration will honor existing contracts.
Unclear Expenditure of Historic Climate Funding by Biden Administration
The Biden administration exited office without disclosing the amount spent from the historic climate funding provided by the Inflation Reduction Act. Politico made an attempt to uncover this information by reaching out to all federal agencies in November. The administration announced awards for about 67% of the $145.4 billion in grants created by the IRA. However, the exact amount legally committed and theoretically protected remained largely unknown.
This lack of clarity persisted until the legislative process for Trump’s One Big Beautiful Bill, which overhauled the IRA’s clean energy tax credits. Republicans in Congress rescinded the unobligated funds from 47 climate and environmental programs of the law. According to Congressional Budget Office scores, around 34% or $31.7 billion of the $93.4 billion allocated for these programs was left untouched.
The Biden administration spent or contracted around two-thirds of the funding from these programs. The data helps us predict the potential effects and outcomes of the Inflation Reduction Act in the coming decades – provided that the Trump administration upholds existing contracts. The obligation of these agreements is currently the subject of several ongoing lawsuits.
For instance, the Environmental Protection Agency, which received the largest allocation from the IRA, committed most of its funds to states, tribes, nonprofits, and other beneficiaries. Billions of dollars dedicated to addressing air pollution in low-income communities and schools, transitioning to next-generation technologies, and aiding states in implementing their climate action plans could potentially flow into the economy, provided the contracts are honored. However, the $27 billion Greenhouse Gas Reduction Fund, while fully obligated, has faced attempts by the EPA to reclaim approximately $20 billion, a process currently stalled in the courts.
The Department of Agriculture efficiently spent its allocation. While it had obligated only about $7 billion of the more than $18 billion allocated for climate-focused conservation programs, only $10 billion of the funding was actually available for the department to use by the time Biden left office. This means it awarded 70% of the available funds but also signifies that Congress has now evaporated a massive $11 billion that could have been disbursed.
Limitations and Future Implications
There are limitations to the data. For instance, it shows that the Department of Energy only spent about 39% of its funding, but because the Budget Office did not break out the rescissions by program, we do not know the exact progress for each or how much was reclaimed. Moreover, several of the programs provide loans and loan guarantees, and the data does not inform about the accomplishments of Biden’s Loan Programs Office. However, the office’s website provides additional information, listing 23 active loans worth nearly $58 billion created after the IRA’s implementation.
Finally, the question of whether and to what extent the Trump administration will disburse previously obligated funds or continue to spend down the remaining programs is a significant one. However, it is not entirely accurate to assume that the OBBB “killed” the IRA. Considering obligated funds and the programs that weren’t rescinded, more than $105 billion could still flow into the economy to combat climate change.
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