Mining and manufacturing have boomed under President Joe Biden’s signature Inflation Reduction Act (IRA), leading to billions of dollars’ worth of investments. Republican states, including Texas, are seeing the lion’s share of the rewards.
According to data from Atlas Public Policy and Utah State University, the IRA has launched $170 billion mining and manufacturing projects in the two years since its passage. Those projects will add roughly 200,000 jobs to the economy, mostly in the renewable energy sector.
Curiously, the boom is disproportionately helping Republican controlled states. An analysis by Jennifer Hiller and Andrew Mollica at The Wall Street Journal shows that three-quarters of the investments are going to districts that lean Republican.
Texas has received a significant chunk of the benefits thanks to the large energy infrastructure in the state. Months after the federal legislation was signed, Governor Greg Abbott celebrated new hydrogen fuel projects in the state while tacitly avoiding mentioning the law that made them possible. The projects from Air Products and The AES Corporation represented nearly 2,000 jobs and $500 million in revenue.
“This project will not only bring hundreds of jobs and millions in revenue to the Lone Star State but will also expand our state’s robust energy sector and further solidify Texas as a global powerhouse in this critical industry,” he said in a statement. “I thank Air Products and AES for choosing Texas, and I look forward to working alongside the two companies and local leaders as we keep Texas a global energy leader.”
Since then, Abbott has consistently defended the state not investing public money in renewable energy by saying the IRA already handles the matter adequately.
According to The Houston Chronicle, within one year of the IRA’s passage, 13 new projects had been announced. These are scheduled to create 4,193 jobs and bring in $52 billion worth of revenue. By 2030, that level of investment will be $66 billion. Texas is attractive to renewable energy investors because of easy land regulations, low taxes, and a ready-made system for delivering and storing energy, though Republican culture war legislation has dampened enthusiasm for the state from some companies.
The IRA has also led to a major electrical vehicle (EV) boom in the state. Car manufacturer Tesla—who moved operations to Texas in 2021—benefitted from an IRA battery tax credit that allowed it to slash prices on the Model Y. With the federal government subsidizing up to $7,500 per vehicle, more people have been able to afford them.
Granted, the majority of Texans still have no plans to purchase an EV, citing a lack of charging infrastructure across the enormous state. However, the IRA is addressing that with a $440 million plan to build stations every fifty miles on Texas highways. Those projects, as well, represent a large investment in the state from federal money. The numbers are clear: Biden’s signature legislative accomplishment has brought a great deal of economic progress to Texas.
