Place-based federal investment can chart a new future for regions dependent on fossil fuel

The Inflation Reduction Act (IRA) and Infrastructure Investment and Jobs Act (IIJA) include historic public investments to accelerate the decarbonization of the American economy in ways that deliver economic benefit to communities most impacted by climate change. Fundamental to this strategy is the...

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Bibliographic Details
Published in:Policy File 2023
Main Authors: Haskins, Glencora, Parilla, Joseph
Format: Report
Language:English
Subjects:
Energy
Environment
The Brookings Institution
Online Access:Request full text
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Summary:The Inflation Reduction Act (IRA) and Infrastructure Investment and Jobs Act (IIJA) include historic public investments to accelerate the decarbonization of the American economy in ways that deliver economic benefit to communities most impacted by climate change. Fundamental to this strategy is the recognition that transitioning the U.S. economy away from fossil fuels disrupts those local economies that have historically relied on oil, gas, and coal. To be sure, carbon-specialized communities have struggled with their reliance on fossil fuels well before the world began its major push toward renewables. Nonetheless, any nationwide decarbonization strategy should also include place-based support for these communities to enable a timely, just transition toward new sources of economic competitiveness and prosperity. But activating regional economic transitions is complex, long-term work that demands significant local capacity and sustained resources. Recognizing the need for additional federal support, programs like the Economic Development Administration's $1 billion Build Back Better Regional Challenge are investing in carbon-specialized economies to help enable these transitions, including an explicit $100 million carve-out for distressed coal communities. This post explores the economic imperative of place-based support in regions with legacies of fossil fuel dependence, and how regional coalitions are utilizing federal resources to accelerate their own economic diversification.