The combination of the IRA and CSA makes up the largest investment in rural US electrification since 1936, and the most notable effect has been in construction spending within the manufacturing sector. Favorable terms, hereunder significant tax credits, have drawn investments like moths to a flame.

Manufacturing construction is currently up some 70% YoY – Tailwinds for our cyclically tilted portfolio.

For some perspective; the sheer magnitude of the IRA made European officials fear that the $369 billion of subsidies for electric vehicles and other clean technologies could skew competition and put companies based in Europe at a disadvantage.

Chart 1: Manufacturing construction up 70% YoY