EU US and UK climate-related spending

The time between the second and the third meeting was marked by intensifying geostrategic and economic challenges such as the continuing war in Ukraine and high levels of inflation and energy prices. These difficulties highlighted the need for and relevance of a strong and close transatlantic relationship, and the TTC’s pivotal role in shaping it. The run-up to the meeting was particularly affected by the US Inflation Reduction Act adopted in August 2022. The IRA earmarked federal funds worth around US$370 billion – the largest in US history – for climate and energy, thereby bringing US spending in this area closer to that of the EU and above that of the United Kingdom (UK) (see Figure 1).