Electric cars
Buying electric cars should also become affordable for the average American. That is why the government is giving substantial tax credits to electric and hydrogen cars. If you buy a new car, you get a $7,500 discount. If you buy a second-hand plug-in car, that’s $4,500.
Clean energy
60 billion dollars (59 billion euros) will go, in the form of tax benefits, to companies involved in the production of clean energy. Half of that money is earmarked for the development and manufacture of solar panels, wind turbines, batteries and the extraction of the minerals needed for this. The Biden administration is investing $10 billion in building clean technology factories. Private individuals can apply for a subsidy for installing solar panels, wind turbines and heat pumps at their homes.
On the other hand, Biden is allocating money to force companies to reduce their emissions: there will be a limit on methane emissions from companies in the oil and gas industry. If those emissions exceed that, they could face fines ranging from $900 to $1,500 per ton of methane.
Compensation for severely affected areas
The Biden administration is also investing $60 billion in so-called ‘environmental justice’ . For example, that money goes to deprived neighborhoods that are disproportionately affected by climate change. 4 billion will go to emergency relief in the southwestern United States, where the Colorado River has been hit by an unprecedented drought and electricity production for 40 million people is directly at risk.
Nearly half of this 60 billion (27 billion) is put into a ‘green bank’ by the government for investment in clean energy projects.
Fossil fuels
To pass his law, Joe Biden has had to make concessions on fossil fuels. The government will auction more public land and water for oil drilling. For example, more can be drilled in the Gulf of Mexico and Cook Inlet in Alaska. There will also be tax credits for oil and gas plants that use their CO2 store underground. The concessions were supposed to win over the opposing Senator Joe Manchin. Manchin represents West Virginia, a state that is more dependent than others on oil and gas. He also has interests in the coal industry himself.
Also in the law: cheaper medicines
Medicare, the general insurance policy for the over-65s, the disabled and the seriously ill, is allowed to negotiate the price of medicines with drug manufacturers for the first time. That will make those medicines considerably cheaper and thus save the government billions. People over 65 won’t have to spend more than $2,000 a year on drugs.
Diabetes patients in Medicare don’t have to pay more than $35 a month for insulin. The rest will be reimbursed. This maximum does not apply to patients of private insurers. That was one of the concessions enforced by Republican senators on Sunday. The Republicans tried to strip Biden’s package as much as possible at the last minute with a barrage of amendments.