Are energy tax credits at risk?

by: Blue Energy Group

The energy tax credits that were made available by the Inflation Reduction Act (IRA) are now under question, as many are trying to figure out if funding for the tax credits will be paused or eliminated following the announcement of President Trump’s energy executive order.

There are two key aspects to consider when evaluating the likelihood of energy tax credit funding from the IRA being paused or eliminated:

1. The specific language and guidance in the executive order.
   
   Section 2 of the Unleashing American Energy executive order outlines a United States policy based on energy production, critical minerals production and processing, the elimination of the “electrical vehicle (EV) mandate, and the promotion of market competition and innovation within the manufacturing and appliance industries.” This section, or the entire executive order text, does not mention tax credits.
   
   
2. Executive orders cannot override laws passed by Congress.   
   
   Reforming IRA tax credits or repealing the IRA would require an act of Congress. An executive order is a written direction used to direct the Executive Branch to carry out policies and programs; this comes from the separation of power clause in the Constitution.
   
   Read the CEO of Blue Energy Group, Josh Howes’ take on whether the IRA will be repealed.

Based on the information released so far, it seems likely that the energy tax credits are not affected by the executive order. However, delays may occur within the IRS and federal agencies as they assess the implications of the executive orders.

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**On January 28^th, the Office of Management and Budget “rescinded its call for a pause on payments for federal grants and other programs.” This announcement calls for rescinding the freeze of federal funding. The call for reviewing funding is still in effect.

(2025, January 29). White House response adds to confusion on federal funding fre