We'll be watching to see what the Trump victory over Kamala Harris in the U.S. Presidential Election potentially means to the COP29 conference; Paris Accord participation; Inflation Reduction Act (IRA) and Climate Tech spending; and overall government spending.
Among the nuggets of information to note:
- Trump is expected to end U.S. participation in the Paris Accord, which may threaten global climate initiatives. Trump in 2017 made a similar move during his first presidency, but the Biden Administration restored Paris Agreement participation in 2021.
- Trump wants to halt IRA spending -- which involves billions of dollars in Climate Tech and U.S. energy transition projects.
- Still, some executives doubt Trump will exit the Paris Accord or end IRA spending, particularly since both efforts can create jobs in some sectors, Reuters noted.
- Elon Musk, a close advisor to Trump, has vowed to scrutinize and cut various federal government spending. Musk, CEO of Tesla, SpaceX and X (formerly Twitter), spent heavily on Trump's election campaign after feuding with the Biden Administration on multiple fronts.
Bottom Line for Climate Tech Startups: At the very least, Climate Tech startups should pursue a faster path to profitability while depending less on U.S. federal dollars for assistance. But those efforts should have been in place long before the November 2024 presidential election.
Indeed, venture capitalists (VCs) since about 2021 have been pushing their portfolio companies to prioritize a path to profits over growth. Nevertheless, thousands of climate tech startups continue to lose money.
Stay tuned for more updates.
