This article was written by Jason Mollner, Managing Partner.
On January 20, 2025, President Trump issued the “Unleashing American Energy” Executive Order, which temporarily halted financial disbursements under the Inflation Reduction Act (IRA) and the Infrastructure Investment and Jobs Act (IIJA). The order directed federal agencies to reassess their funding policies in alignment with the administration’s broader energy agenda, effectively disrupting funding for clean energy projects. No reports from this planned reassessment have been released yet, so it is impossible to know what position will be taken by the Director of the Office of Management and Budget OMB, the Assistant to the President for Economic Policy, or the “new kid on the block”, the Department of Government Efficiency (DOGE)
As the April 20th expiration of this executive order approaches, green energy project investors face several possible outcomes that could significantly impact the future of federal clean energy investments.
Scenario 1: The Order Expires, and Treasury Resumes Green Energy Disbursements
If neither Congress nor the President takes action, the executive order will expire, allowing the Department of the Treasury to resume disbursing funds for clean energy projects. This would restore funding streams for initiatives such as the National Electric Vehicle Infrastructure (NEVI) Formula Program and other renewable energy investments. Clean energy advocates and industry stakeholders would likely welcome this outcome, but it may trigger political backlash from those opposing the IRA’s provisions.
Scenario 2: The President Extends the Executive Order for 90 Days
President Trump could opt to extend the executive order for another 90 days, maintaining the current freeze on disbursements. This would provide additional time for his administration to further evaluate or attempt to modify funding mechanisms within the IRA and IIJA. An extension would signal continued uncertainty for renewable energy investors and businesses reliant on federal support.
Scenario 3: The Executive Order Expires, but Treasury Personnel Are “Gutted”
The Department of Government Efficiency (DOGE) has covered a lot of ground in the first 3 months of the Trump presidency. If the executive order is allowed to expire but the administration, via DOGE, concurrently removes or reassigns key Treasury officials responsible for fund disbursement, the practical effect could be an indefinite delay in green energy financing. This strategy would likely face immediate legal challenges from clean energy companies and advocacy groups, potentially leading to high-profile court battles over the administration’s authority to obstruct funds already allocated by Congress. The ensuing litigation could create long-term regulatory uncertainty, affecting both federal agencies and private-sector investments. State agencies implementing federal grants, such state departments of transportation implementing funds from the National Electric Vehicle Infrastructure (NEVI) Program, would also face uncertainty as to whether funds allocated to specific projects would be available to distribute, likely resulting in delays until any litigation is resolved.
Scenario 4: Congress Introduces a Tax Plan, Potentially Shaping the Outcome
A fourth possibility is that Congress releases its new tax plan around the time of the executive order’s expiration. If this occurs, President Trump may decide to let the law outlined in the tax plan prevail, potentially altering or extending the IRA’s clean energy investment tax credits. The Tax Foundation, a key Republican-leaning DC tax policy research “think-tank”, has released two options [1]for tax reform and both fully eliminate the green energy incentives in the IRA. Unfortunately, options are extremely limited to achieve a revenue neutral tax plan while prioritizing popular provisions like bonus depreciation, R&D expensing, and an EBITDA-based interest deductibility limitation.
This outcome would depend on the details of the legislative proposal and whether it aligns with the administration’s energy priorities. If the tax plan does not favor green energy investment, it could effectively maintain restrictions on clean energy funding through legislative means rather than executive action.
The Path Ahead
The approaching expiration of the “Unleashing American Energy” Executive Order is a pivotal moment for U.S. energy policy. Whether through inaction, extension, administrative maneuvering, or new legislation, the decisions made in the coming weeks will shape the trajectory of clean energy investment in the country. Businesses and investors should closely monitor these developments and prepare for potential shifts in the regulatory landscape.
For those seeking guidance on how these changes might impact their operations, we are here to help. If you have any questions or are interested in learning more, don’t hesitate to reach out today!
This material has been prepared for general informational purposes only and is not intended to provide, and should not be relied on for, tax, legal, or accounting advice. Should you require any such advice, please contact us directly. The information contained herein does not create, and your review or use of the information does not constitute, an accountant-client relationship.
[1] https://taxfoundation.org/research/all/federal/2025-tax-reform-options-tax-cuts-and-jobs-act/