The proposed overhaul of green energy tax credits by the Trump administration has caused significant unrest within the climate tech sector. Following the passage of a bill cutting these crucial incentives, startup founders and investors are scrambling for alternative strategies, fearing that many companies may not survive. The once-growing momentum generated by the Biden-era Inflation Reduction Act is now jeopardized, pushing startups to reconsider their operations and eye more favorable conditions in Europe, amid mounting pressure from changing industrial policies.
There will be a graveyard of companies, and a lot of startups will hibernate to try to weather the storm.
It was the techno-economics that led us to pull the plug, adding that the market conditions for climate tech startups in the US were hampered by waning industrial policy.
A byproduct of the new tax bill - and growing political backlash against ESG incentives - is that Europe is becoming more attractive for climate techs to set up shop.
Founders and investors are concerned about the knock-on impact this could have on the country's climate tech ecosystem, which was burgeoning under the Biden-era Inflation Reduction Act.
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