The Inflation Reduction Act in Public Power Communities: A Case Study Series

Case 1: Columbia, Missouri

The Inflation Reduction Act will be remembered by many as the first significant investment by the federal government to fight climate change in the United States. And in conjunction with the bipartisan infrastructure law and the Chips and Science Act – these climate provisions will provide an overall punch against the climate crisis – the largest threat of our lifetimes. 

Because of this federal policy, state and local leaders now have the opportunity to maximize these dollars and use them for clean energy projects – efforts that will create new jobs, lower utility costs, and lower pollution in one swoop. 

But here’s what’s happened since the Inflation Reduction Act has been in existence: a large majority of Americans – including the people who can help with this clean energy transition – still do not know what’s actually in this signature law. Many have heard very little about these transformational opportunities. 

It’s imperative that state and local elected leaders take advantage of the Inflation Reduction Act, and that’s why Climate Cabinet Education stepped up and released “The Inflation Reduction Act: A Guide for Leaders of Public Power Utilities” – a resource to help connect public power leaders to this historic investment. Announced alongside Barbara Buffaloe (Mayor of Columbia, Missouri) and Tim Nies, Regional Services Manager at Energy Northwest, this guidebook will help these municipal utility (muni) leaders maximize the opportunities provided by the IRA. 

This resource is intended to help Public Power leaders from cities large and small and in all 50 states, because as Climate Cabinet knows, fighting the climate crisis does not stop along state lines. Also, each muni has its own special set of circumstances and requirements needed for their own clean energy transition. Recognizing the uniqueness of this situation, Climate Cabinet’s guidebook put a spotlight on four cities to help share what investment opportunities are possible. 

As the start of a month-long series of blog posts highlighting the case studies featured in our guidebook, we’ll be using today to talk about Columbia, Missouri

Columbia, MO is a city that has demonstrated a strong commitment to climate action – and the IRA presents an opportunity to accelerate climate goals, while potentially lowering costs associated with repurposing aging fossil infrastructure.

When now-Mayor Barbara Buffaloe served as the city’s Sustainability Manager, the city council adopted the Climate Action and Adaptation Plan in 2019, which directs the city council to codify by ordinance a 2035 100% renewable energy goal for their municipal utility, Columbia Water and Light.

Columbia’s municipal plant—which, since its coal generator stopped running in 2015, runs only gas and recently underwent coal ash cleanup—is a prime target opportunity for the IRA’s Energy Infrastructure Reinvestment Financing provision. This provision guarantees loans to clean energy projects utilizing energy infrastructure that has either ceased operation or is on the cusp of replacement by its owner, and the retired coal powered unit at the municipal plant could be a suitable site for converting into battery storage. 

Currently, Columbia Water & Light’s current resource plan does not project investments in battery storage until 2038, but it could be in Columbia’s best interest to invest earlier than that date and the IRA could make this possible. In addition to the applicable cost saving, benefit maximizing measures in the IRA, lithium-ion batteries have declined in cost and are more affordable than ever. 

On top of having defunct coal assets, the municipal plant’s current natural gas generators are aged and need upgrades, so the options provided by the IRA should be taken into serious consideration for not just the coal generator but for how the plant as a whole can be transformed to better benefit the community. By initiating a battery project at the site of the municipal plant before 2026, Columbia could unlock the IRA’s benefits by achieving the following: 

  • Use the federal government’s Energy Infrastructure Reinvestment Financing loan guarantee, easing the financial burden of an inevitable energy transition
  • Repurpose an existing site, and
  • Implement technologies that can address public concerns around cost and reliability of a 100% renewable portfolio 

With the historic precedent with the IRA, now – not later – is the opportunity for communities large and small to update its infrastructure that would produce new economic opportunities, a pathway toward a clean energy transition, lower utility costs for customers, and lower pollution for future generations. 

Columbia represented a great case study in Climate Cabinet Education’s guidebook because it tells the story of how munis with out-of-use infrastructure could capitalize on the historic climate investments of the IRA. And this is just one of the many ways IRA financing can benefit residents of Columbia. Next week, we will take a look at another community in Missouri: Sikeston. The case study will explore how they can capitalize on the Inflation Reduction Act, including Department of Agriculture programs that are unavailable to many other municipalities.