The Potential Impact of the IRA on the Future of a Native American Reservation



The Red Lake Nation in northern Minnesota plans to use federal funding from the Inflation Reduction Act to pursue energy independence through solar power generation. The Act includes over $720 million for Tribal nations and native communities and makes expanded clean energy tax credits available to them for the first time. The Red Lake Nation’s Chairman, Darrell G. Seki Sr., aims to generate all of the power the tribe uses and even sell excess power into the grid, creating a new revenue stream for the tribe.

The Inflation Reduction Act and Tribal Nations

The Inflation Reduction Act (IRA) allocates over $720 million for Tribal nations and introduces clean energy tax credits for these communities. In the “Breaking Ground” series, host Kai Ryssdal explores the impact of these funds in places like the Red Lake Indian Reservation in northern Minnesota.

The Goal for Red Lake Nation

The Red Lake Nation’s reservation spans over 800,000 acres, housing around 5,500 people. As of 2022 Census data, the reservation has an employment rate below 50%, and over 30% of the population lives under the poverty line. Tribal Chairman Darrell G. Seki Sr. has expressed his commitment to energy independence and tackling high energy costs through solar paneling.

The State of Solar at Red Lake

The first building to have rooftop solar at Red Lake was the Government Center, a project led by Ralph Jacobson and Bob Blake in 2018. Since then, they have been working towards Seki’s goal of energy independence through expanded solar power. Their aim is to generate enough power for local use and sell the surplus energy into the grid, thus creating jobs and revenue.

The IRA’s Role in Solar Project Funding

Pilar Thomas, a tribal energy and economic development lawyer, emphasizes the importance of the IRA in funding these projects. For the first time, the Act allows tribes to access clean energy tax credits. Previously, as non-taxable entities, tribes were ineligible for such credits. Under the IRA, they can now receive a direct payment equal to the value of the tax credit. This change is expected to significantly incentivize clean energy deployment on tribal lands.

Red Lake’s Future in Solar

The planned utility-scale solar farm at Red Lake is expected to be over 200 times larger than the rooftop solar on the Government Center. The tribe spent $700,000 in 2020 to purchase over 200 acres of land near the reservation for this project. The project aims to generate 15 megawatts of power, much more than the 5-7 megawatts required to power the reservation, allowing the tribe to sell excess power. However, it is estimated that it will take three more years for the project to start generating power.

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