The Inflation Reduction Act is the largest clean energy spending package in U.S. history, but analysts at Bank of America warn it may not live up to its nom de guerre.
“The IRA aims to achieve many goals over the next decade, like reducing emissions at an accelerated rate. However, its name may become a misnomer if investment surges while supply chains remain constrained, fueling inflation,” according to a BofA Global Research report issued Friday.
The problem, say BofA analysts, is that transmission “does not play a prominent role” in the spending law – and without additional capacity, renewable energy development may accelerate in areas where it cannot be efficiently brought to market, “which could lead to even more price volatility in those markets as load balancing challenges intensify.”
“Additionally,…