USA- Maximizing the Value of the Energy Infrastructure Reinvestment Program for Utility Customers. “Capital recycling” can help deploy clean energy assets, cushion ratepayer impacts, and offer sustained earning RMIChristian Fong,  David Posner,  Uday Varadarajan May 24, 2024 Introduction......Clean energy costs are falling, driven by technological advancements, economies of scale, and federal tax credits that were significantly enhanced and extended by the Inflation Reduction Act (IRA). The most important improvements to the tax credits aim to unlock the benefits of clean energy for the customers of fossil-heavy electric utilities — making it more attractive for these utilities to reinvest in assets that can reduce energy bills and harmful emissions. RMI’s recent work on clean repowering suggests that 250 GW of wind, solar, and battery storage assets — equivalent to nearly 20% of the total existing generating capacity of the US power sector — could be built rapidly by sharing existing or retiring fossil plant grid connections without impacting system reliability. This would reduce emissions by 25%, increase utility earnings, and save customers more than $12 billion annually through 2035.
That’s good news, but it’s only part of a more complicated and less rosy picture. As regulated utilities and their customers look to seize upon attractive clean energy opportunities, they must also manage the legacy of prior investments. Put simply, the transition to clean means passing through a zone of overlapping financial obligations, with the front-loaded capital expenditures of the clean system layered on top of ever-growing costs and risks associated with continued operation of the fossil-intensive system. At a time when Americans are feeling pinched by inflation at just about every turn, bearing the burden of overlapping energy systems is hardly an inviting prospect. 
To address this looming burden, the framers of the IRA purposefully created the Energy Infrastructure Reinvestment (EIR) Program to make available up to $250 billion in extremely low-interest federal loans for a cleaner power sector. The question before us is how to maximize the benefits of this massive allocation of taxpayer resources. If utilities do nothing more than use EIR loans to displace corporate debt, overall ratepayer savings will be minimal, since most utilities can already borrow at reasonably attractive interest rates without the added complication and expense of participating in a government program. However, if utilities and their regulators cooperate to combine more ambitious usage of federal debt with ratemaking strategies that concentrate equity in the financially attractive assets of the clean system, EIR has the potential to deliver substantial rate relief to customers as well as sustained earnings opportunities for shareholders.his win-win approach is called “capital recycling.” 
 
This insight brief, which builds on a February RMI article, describes how different EIR implementation choices will impact the financing costs that utility ratepayers will bear over the coming decades. The brief covers- 
  1. The legacy costs and risks of a fossil-intensive system and the challenges they pose for utility reinvestment in clean energy.....read on- there's four more.....https://rmi.org/maximizing-the-value-of-the-energy-infrastructure-reinvestment-program-for-utility-customers/