State Climate Ambition With the Inflation Reduction Act

Passage of the Inflation Reduction Act (IRA) in August 2022 marked the single largest action ever taken by the federal government to address climate change and represents an inflection point in greenhouse gas (GHG) emission trajectories in a wide range of modeling scenarios. In Taking Stock 2023, Rhodium Group estimated current policy, including the IRA and binding state policies with specific targets and timelines, would drive economy-wide emissions to 29-42% below 2005 levels in 2030.

While this reflects an acceleration of the rate of decarbonization over historical levels, it is still not fast enough for the US to achieve its 2030 Nationally Determined Contribution (NDC) under the Paris Agreement of a 50-52% reduction below 2005 levels. The Environmental Defense Fund (EDF) commissioned Rhodium Group to independently assess the emissions and energy systems impacts of achieving state GHG targets consistent with the US Nationally Determined Contribution (NDC) in climate-leader states, including the effects and consequential federal investments of achieving these targets driven by the Inflation Reduction Act (IRA).