If Wyoming follows through with some of its climate friendly energy goals, it stands to make a lot of federal money, according to a new report from the Rocky Mountain Institute (RMI).
The report looks at how states will financially benefit from the Inflation Reduction Act (IRA), which is a large piece of climate legislation that Congress passed last summer. It provides tax incentives for carbon capture projects and other renewable energy projects, like wind.
“So Wyoming has some of the best wind resources in the country,” said Ashna Aggarwal, an author on the report and senior associate at RMI.
She said if Wyoming capitalizes on the IRA, the tax benefits could be huge.
“If you have a new wind project this tax credit will actually cover 30 percent of that project costs, really saving utilities money on that project,” she said.
Wyoming could make over $12,000 per resident in tax incentives by 2030, or about $7 billion total, which is more than any other state. But that is only under a climate ambitious scenario, which the report defines as meeting national climate targets. Some of those targets include, by 2030 reducing greenhouse gas emissions by half compared to 2005 levels and achieving a net-zero emissions economy by 2050.
And for its part, Wyoming is largely embracing renewable energy projects. For example, one of the largest wind farms in the country is slated to go up near Rawlins. Wyoming is also heavily eyeing carbon capture technology, which in theory can either capture carbon directly at coal plants or remove the carbon already released into the air. The effectiveness of the technology is largely debated, but Wyoming is moving forward with several projects, including Project Bison, which would capture carbon already in the atmosphere.
“It's one of the farther along commercial scale direct air capture projects anywhere in the U.S.,” said Aaron Brickman who is a senior principal at RMI. “And it will leverage the existing carbon capture and sequestration tax credit, which was expanded under the Inflation Reduction Act. So quite a lot happening, and I think Wyoming is pretty well positioned to leverage it.”
But to get the full financial benefits of the IRA, Wyoming would have to support other climate friendly changes – like driving electric vehicles. This year state lawmakers proposed banning the sale of electric vehicles – ultimately it did not pass. The state is also still holding onto coal – recent law gives the state funding to prosecute anyone who negatively affects Wyoming’s coal industry.
“Everyone's eyes looking at this study, gravitate to Wyoming, whether you live there or not because of how clearly the state is positioned for success,” Brickman said. “But it's only potential, right? They have to embrace these policies.”
Aggarwal added that the state can do this by allowing “individuals and businesses to buy new electric vehicles, buy new heat pumps, renewables, energy efficient equipment, and this is all to save people money.”
The report also indicates Wyoming could see 2,000 new jobs through embracing policies that the IRA financially rewards.
