The potential impact on the Inflation Reduction Act (IRA) under a Republican administration in January 2025 will depend heavily on their legislative priorities, the composition of Congress, and political dynamics. 

With a Trump presidency, unified Republican control of Congress, and a Supreme Court dominated by MAGA-aligned judges, the IRA faces significant threats. The Trump administration, characterized by climate skepticism and loyalty to fossil fuel interests, is expected to pursue aggressive rollbacks of the IRA’s climate-focused provisions. With Doug Burgum as Secretary of the Interior, policies will likely favor expanded fossil fuel extraction on public lands and reduced support for renewable energy development.

Key impacts under these conditions may include:

1. Wholesale Repeal or Defunding: Unified GOP control increases the likelihood of repealing or defunding large portions of the IRA, including clean energy tax credits and incentives, under the guise of reducing federal spending or opposing “green energy favoritism.”
2. Reversal of Implementation Rules: A climate-denying administration is likely to rewrite rules governing the IRA to favor fossil fuels, deregulate energy markets, and limit the applicability of renewable energy incentives.
3. Expansion of Fossil Fuel Projects: Leadership under Doug Burgum and other fossil fuel advocates will likely prioritize oil, gas, and coal development, emphasizing “energy dominance” over climate goals.
4. Aggressive Oversight of Renewable Energy Spending: Republican-led investigations may cast renewable energy projects as wasteful or corrupt, further discouraging investment and slowing industry growth.
5. Judicial Challenges to Climate Policy: A MAGA-dominated Supreme Court could impose rulings that curtail federal agencies’ regulatory authority over emissions and climate initiatives, effectively hamstringing the execution of environmental policies.

Broad Implications:

The combination of legislative, executive, and judicial alignment creates a hostile environment for climate policy. The renewable energy sector must brace for significant funding cuts, regulatory hurdles, and legal challenges, while fossil fuel industries are poised for a resurgence. Internationally, this shift undermines U.S. climate commitments and could disrupt global progress toward emissions reductions.

Clean energy clients must act swiftly to take advantage of current incentives and secure their projects before potential policy changes disrupt the landscape. Here’s how the timeline for energy projects could be impacted:

The Urgency of Acting Now

• With a new administration and Congress taking power in January 2025, there is a high likelihood of rapid policy changes. Projects initiated under current IRA incentives may avoid future disruptions, but delays could jeopardize access to funding and benefits.
• Move projects from the planning phase to execution quickly, because the window of opportunity is narrowing.

Potential for Fast Policy Changes

• How Quickly Could Things Change?
  • Legislation: A Republican-controlled Congress could introduce bills to repeal or significantly alter the IRA within the first 100 days of the administration. While changes would take time to pass, the threat alone can create uncertainty in the market.
  • Rulemaking: Federal agencies under the Trump administration could immediately begin revising regulations to weaken or delay IRA implementation. These changes could start within weeks of the administration taking office.
  • Budget Actions: Funding for IRA programs could be slashed or redirected during budget negotiations, particularly in the federal fiscal year 2026 process, which begins in the summer of 2025.

Concerns About Incentives for Projects Already Underway

• Could Incentives Be Revoked?
  • Generally, tax credits and grants for projects that meet eligibility requirements at the time of application or commencement are difficult to revoke retroactively.
  • However, future incentive programs or extensions may be canceled, and eligibility criteria could be tightened, creating additional hurdles for projects not yet in progress.
  • Remember, the IRA extended and expanded the FITC which was already drastically sunsetting.
  • Projects relying on multiyear funding streams could face risks if federal appropriations are withdrawn before completion.

Leverage “Grandfathering” Protections

• Starting your project under current laws and submitting applications for incentives as soon as possible may ‘grandfather’ you under existing rules, protecting your investment from future changes.
• Once started, document project start dates and applications thoroughly. Consult legal or tax experts to ensure compliance with existing rules that may shield the project.

Risk of Delaying

• Delaying decisions means you risk losing access to today’s generous incentives, and waiting could lead to higher project costs and diminished financial returns.
• GEES can help you quantify the potential loss of incentives and ROI erosion if you delay. See our financial models to learn how immediate action secures better outcomes.

Political Dynamics

• With a MAGA-aligned administration, Congress, and judiciary, changes to the clean energy landscape could happen swiftly. The earlier your project is in the pipeline, the more likely it is to secure current benefits.
• Take advantage of the IRA incentives before the rules potentially change. The smart move is to leverage market momentum and existing bipartisan support in some areas (such as domestic manufacturing or energy independence).

Stay the Course on Clean Energy Investments

• The long-term fundamental benefits of clean energy remain strong, driven by market dynamics, consumer demand, and global climate commitments. Even in a hostile political environment, renewable energy technologies are cost-competitive and offer significant operational and financial benefits.
• Focus on projects that deliver immediate cost savings, such as energy efficiency upgrades and/or onsite renewable installations with short payback periods. The combination of efficiency upgrades and onsite generation is one of the most financially beneficial improvements you can make for your business or home.

Prioritize Resiliency and Self-Sufficiency

• We know that the cost of energy will continue to rise despite political rhetoric, as evidenced by historical data.
• With potential rollbacks of federal programs, self-sufficient energy systems, such as solar-plus-storage, are increasingly valuable for energy security and independence.
• Investments in resilient infrastructure, such as microgrids, energy storage, and backup systems protect against grid volatility and political uncertainty.

Leverage State and Local Opportunities

• State and local governments, particularly in clean energy-friendly regions, will continue to provide incentives and support for renewable energy projects, however much of that funding originated in the IRA.
• GEES can help you identify and apply for state-level grants, rebates, or financing programs, as well as the federal-level grants before they are dismantled.

GEES Monitors Policy Changes Closely

• The political landscape is shifting, but with preparation, we can mitigate risks and seize new opportunities.
• GEES performs ongoing policy monitoring and analysis to keep you informed about changes in federal and state energy programs. We can help you pivot your energy project strategies as new regulations emerge.

The Business Case Around Economics, Not Just Sustainability

• Even without federal support, clean energy investments make economic sense, offering operational savings, energy price stability, and increased property values.
• Clean energy projects are sound business decisions, with proven ROI and long-term cost savings rather than relying solely on environmental or policy justifications.

Private Financing and Partnerships

• As federal support diminishes, private financing and public-private partnerships will play an increasingly important role in advancing clean energy projects.
• GEES can connect you with private equity, green bonds, and impact investors who are still committed to clean energy. We can offer innovative financing mechanisms, such as power purchase agreements (PPAs) or energy-as-a-service programs.

Prepare for Heightened Scrutiny and Reporting

• The political environment will likely bring increased scrutiny of clean energy projects, but transparent reporting can help mitigate risks.
• GEES can help you document project outcomes thoroughly, including cost savings, job creation, and community benefits, to counter negative narratives and justify investments.

Education and Advocacy

• Raising awareness and building coalitions will be critical to maintaining momentum for clean energy. We can all continue to participate in that cause.
• You are encouraged to educate your stakeholders—employees, customers, and community members—on the benefits of clean energy. Consider joining industry coalitions or advocacy groups to amplify your voice.

Key Takeaway

For the long term, we must focus on what is within our control: leveraging local opportunities, demonstrating economic value, and building resiliency. While the political landscape may be challenging, the clean energy transition is ultimately driven by market forces, innovation, and public demand that cannot be easily reversed.

Nonetheless, for the short term, IRA incentives represent a “use it or lose it” opportunity. Projects started under current policies are more likely to be protected, while delays could mean losing out on valuable financial and operational benefits. Acting now provides a layer of protection against political and regulatory uncertainty.

* I am not a certified tax professional and cannot give you tax advice. 

I can show you what other folks have done with renewable energy tax credits, 

but you will ultimately need to run this by your tax professional for verification of your eligibility.