Inflation Reduction Act: New Funding for Tribes

Posted on January 5, 2023 by Kate Ayres
Tags, Energy

Wind turbines and solar panels against a blue sky

Many within the climate community are awaiting the rollout of the Inflation Reduction Act (IRA). These new funds will help address the climate crisis, as well as build up an economy that works for working families. Over $700 million of that funding is provided in direct climate resilience and energy funding for Native-driven solutions and to advance Tribal Nations development priorities including agriculture, Indian Affairs, and other areas.

This investment puts Tribal Nations in a position to lead work within the energy transition. It also highlights the importance for collaboration and cooperation between Tribal states and other government entities, utilities, organizations and companies within the energy planning and development process.

New Tribal Funding Highlights

The funding directed to Tribal Nations and communities includes:

$235 million through 2031 for Tribal climate resilience, including fish hatchery operations and maintenance
$225 million for development of Tribal High-Efficiency Electric Homes Rebate Programs (HEEHRP)
$150 million through 2031 for the Tribal Electrification Program, which includes money for home repair and electrification
$75 million for the Tribal Energy Loan Guarantee Program and $20 billion in allowable loan guarantees
$25 million for Native Hawaiian climate resilience
$12.5 million for Tribal emergency drought relief

In addition to new funding, the Inflation Reduction Act will update tax code and start new programs to benefit Tribal and Indigenous communities. If you’re interested in digging into all the details, the U.S. Senate Committee on Indian Affairs released a resource guide that includes all of the provisions supporting Tribal and Native communities.

Tax Credits and Deductions

The Act extends access to tax incentives for Tribal Nations who had not previously been given the tax-exempt status. This includes tax deductions for increasing energy efficiency in buildings and tax credits to produce renewable energy. The Investment Tax Credit has been extended, with the addition of a new subsection carved out for Environmental Justice communities, including an additional 10% for projects on Tribal lands.

Access to these tax incentives and credits not only open opportunities for increased energy efficiency and renewable energy development, but also offer money saving resources to Tribal communities. These resources allow residents to increase home and building efficiency, save money on their monthly energy costs, and ultimately result in wealth building opportunities for families and communities.

More information about non-tax and tax provisions for Tribal and Indigenous Communities can be found in a memo produced by NDN Collective and ReWiring America that you can find at this link.

Utilizing Native Leadership and Expertise

Oregon is home to 9 federally recognized tribes and has others that cross over its border from our neighboring states. Collaboration will be key in ensuring that funds are adequately utilized to push forward not only our energy transition across the Northwest, but to welcome new leaders into the clean energy movement.

This new funding is a big deal for advancing clean energy goals across the country. To make the most of it for everyone, we need high levels of collaboration with Native leaders. This connection will ensure that Tribal Nation’s sovereignty, culture and resources are respected. Including their expertise and knowledge will make planning and developing projects more effective.

As CUB heard during our 2022 Conference this fall, tribal consultation and connection within utility planning and energy processes is an area that needs to be strengthened. This funding provides an opportunity to strengthen efforts within this area.

New Energy Project Must Respect and Honor Tribal Lands

Siting projects should also include Tribal leadership. When a new energy project is created, it must go somewhere. Including Tribal leaders in the decisions of these locations is vital to ensuring new projects are benefitting – and not harming – Native communities.

When siting on Tribal land, it is important to understand that Tribal cultural sites should not be considered for development. Including tribal voices into conversations around siting can help navigate ancestral and sacred spaces. Renewable energy developers should know that Tribes may rule out a location without a detailed description of why. There are many issues that come with public knowledge of cultural sites and Tribal privacy must be protected.

More Funding and Investments are Coming

CUB is watching the rollout of Inflation Reduction Act investments. We will advocate for utilities and government agencies to leverage the available funding coming from this historic investment. CUB will continue to push for bold action on climate change and energy transition issues here in Oregon. We will work towards ensuring that the necessary voices help advise equitable and just paths forward.

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