The Inflation Reduction Act, signed into law last month by President Biden, includes around $370 billion for clean energy development and adoption. But it is not a venture capital fund, despite viral tweets to that effect.

Why it matters: $370 billion is a ton of taxpayer money, and it will deserve a rigorous review that begins from a place of common understanding — rather than from atop a strawman.

Tweets: David Sacks, founder of Craft Ventures, wrote:

Reality check: Over $200 billion of the $370 billion is tax credits over the next decade, including for solar energy farms, electric vehicle purchases and purchases of energy-efficient home appliances. Some of that includes extensions of existing tax credits.

• There also are additional earmarks for such things as agriculture conservation programs ($20 billion), wildfire management ($2 billion) and coastal protection and restoration ($2.6 billion).
• Yes, tax credits can help boost the fortunes of private companies, such as those developing EVs or microgrid hardware. But they aren't in the same vein as equity investments in specific companies, either structurally or philosophically.

Sacks didn't return a request for further comment.

Venture capital: The closest thing to a "VC fund" in the IRA would $11.7 billion for Department of Energy loan guarantees, which enables $350 billion in loan guarantee authority.

• Yes, these are the same sort of DOE loans that once supported Solyndra. But notice that $281 billion delta? That's because the overall default rate on such loans is extremely low — particularly because DOE doesn't view itself as taking technology risks skin to a venture capitalist. Even back in the aughts, the program's largest loan wasn't to Solyndra, but instead to help Georgia Power build a pair of next-gen nuclear reactors.
• Moreover, even the Solyndra-era DOE loan guarantee program generated around $30 billion in profits. And we know this because there was public accounting.

The bottom line: Governments often stumble when trying to play venture capitalist. Luckily that isn't an issue in this case, no matter your feelings on the overall IRA or its climate aims.

[Correction: An earlier version of this story had an incorrect dollar figure for the DOE loan guarantees included in the IRA.]