On April 22nd, Earth Day, President Biden announced a $7 billion federal grant to support residential solar projects, helping residents in underserved communities use solar energy and save on electricity bills. This subsidy is included in the Inflation Reduction Act. According to the White House, this initiative will create 200,000 jobs and save households in the program approximately $400 per year. It is estimated that these projects will ultimately reduce emissions equivalent to 30 million tons of carbon dioxide.
In addition, Biden announced that the U.S. government will open recruitment for the American Climate Corps. This initiative was launched by Biden last September as a government employment program aimed at engaging the next generation of Americans in addressing the climate crisis. Young voters are often more concerned about climate change and are key constituents for Biden.
However, according to a report from the British Daily Mail on April 22nd, Biden's $7 billion Earth Day solar subsidy plan has come under attack from opponents who even brought up China. They claim that this plan provides unlimited tax credits for companies investing in green energy but does not prevent foreign companies from accessing American taxpayer money, undermining efforts under the Inflation Reduction Act to revitalize domestic manufacturing with clean energy factories.
The Inflation Reduction Act passed in 2022 includes billions of dollars in tax credits to help businesses transition towards low-carbon sources like wind power, solar power, and nuclear power. It also includes incentives worth billions of dollars, encouraging people to purchase electric vehicles and home electric heat pumps.
A Reuters report from March revealed that, based on regulations released by the U.S. Treasury Department nearly a year ago, builders using solar panels with batteries manufactured in America would be eligible for a 10% tax credit due to using domestically produced batteries. Additionally, some solar manufacturers have been lobbying for stricter domestic content requirements as a response to an abundance of Chinese-made products flooding global markets.
Economist Ferri from the Prosperous America Alliance stated that "the fiscal support under the Inflation Reduction Act is helping us rebuild our lost solar industry from ten years ago."
If stricter restrictions are not imposed on imported solar panels, then it could backfire against the Inflation Reduction Act. He also mentioned that currently there is excessive construction of US's solar manufacturing equipment while demand for solar is only moderately increasing
Previously, US Treasury Secretary Yellen responded during an interview with US media outlets, hyping up how the Chinese government provides "massive" assistance to electric vehicle battery and solar manufacturers, aiming to truly dominate these industries globally and give them competitive advantages. Responding to this, the Chinese Foreign Ministry emphasized that China's booming new energy industry relies on technological innovation formed through competition within global markets rather than relying on so-called subsidies supporting protection, and urged the US side to correct discriminatory industrial policies promptly.