Strengthening Supply Chains for US Decarbonization

Abstract

The 2022 Inflation Reduction Act provides new sources of capital and incentives for accelerating net-zero efforts. The law concurrently seeks to shift supply chains vital for US decarbonization to domestic sources and, more selectively, to links with free-trade partners. However, challenges abound. This policy paper responds by exploring opportunities inherent to rapidly creat­ing just, low-carbon, and sustainable supply chains for key sectors of the US economy. These recommendations center upon the following key efforts:

Expediting permitting for critical decarbonization materials Applying exceptions and special waivers on domestic content Incentivizing recycling and materials innovation Applying domestic content guidance progressively Developing human capital Developing decarbonization clusters Expanding domestic exploration incentives Prioritizing friendshoring, risk reduction, and low-carbon trade in foreign policy

This report is part of Keys to the US Energy Transition: An Energy Pathways USA Series.