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If you were designing a local government training on the ways a low-income community can access the IRA incentives how would you go about doing that?

Diane Cherry's picture
Principal, Diane Cherry Consulting, LLC

Diane Cherry is a woman owned small business providing clean energy consulting services for local government, clean energy companies, non-profits and educational institutions. Her projects and...

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Power sector has witnessed a tremendous transformation from fossil fuels to renewable energy.  This transformation has been more pronounced during the post-pandemic period with the mandate on ‘Carbon neutrality’.  Every country has been trying their best towards judicious mix of fossil fuel and renewable so much so that it has a tremendous bearing on the distribution and transmission section of the power sector. US being a developed country have been promoting strategies with a greater vigour to benefit the low income community.  ‘Smart Grid’ in this regard is a network that seems to be catching up faster as the digital and other advanced technologies facilitate monitoring and managing transport of electricity. There are indeed many players in this game starting with generators/grid operators/end users and even electricity market stakeholders.  The aim/objective is not only maximum system reliability, resilience, flexibility and stability but also minimising costs and environmental impacts. 

Advanced economies like US have indulged in investments that outpaced electricity demand growth due to devotion on replacing and upgrading equipment and strengthen structures against weather related damage.  These changes are understandably bound to improve Individual Retirement Account (IRA) incentives.

IRAs is primarily for self-employed people who do not have access to workplace retirement accounts available through employers only.  IRAs are of different types – Traditional IRAs; Roth IRAs, Simplified Employee Pension (SEP) and Savings incentive Match Plan for employees (SIMPLE) IRAs though there are certain rules governing them. Individual tax payers can establish traditional and Roth IRAs while small business owners and self-employed can opt for SEP & SIMPLE IRAs.  Each of these IRAs has its own rules to be complied with. The maximum annual individual contribution to traditional IRA (50 years or older) was $6000 in 2022 which has gone up to $6500 in 2023 along with catch-up contribution of $1000.  Investments in IRAs being long term, you defeat the purpose with an early withdrawal. 

Pro-active measures do provide greater opportunity to motivate low income community not only to IRA but any other government mechanism that may come up in future.

Diane Cherry's picture
Diane Cherry on Mar 7, 2023

Thanks for your response. I think you misunderstood my question I was referring to the Inflation Reduction Act not IRA like personal investment options. I should have been more specific in my question so as not to confuse you - 

A. K. Shyam, PhD's picture
A. K. Shyam, PhD on Mar 8, 2023

Thanks for your clarification.  Let me try to add that later, please.

Great question! Many webinars are springing up on the opportunities in the IRA. The larger accounting and consulting firms have webinars for view. I think an approach would be to get an overview, then key on specific programs and find resources in the area of grant writing expertise to maximize the chances of being successful. 

Diane Cherry's picture
Diane Cherry on Mar 7, 2023

Thanks Russ, I appreciate your comments. I think the concern is that there are so many options, and opportunities it's daunting for local government. I have a client now that I'm trying to help wade through the clutter and it can be overwhelming for sure.

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