I still remember the first time a client asked me:
“Should I invest in the green-energy startup and ride the subsidy wave?”
As a tax strategist, I loved pointing out the upside of generous tax credits and enthusiastic government support. But lately I’ve been pressing pause.
Not because I don’t believe in environmental innovation or sustainable business — quite the opposite. I’ve simply concluded that given the shifting political, regulatory and resource realities, green investments are riskier than many entrepreneurs realise.
Let me walk you through why I’m holding off for now, what the implications are for savvy business owners, and when — and under what conditions — I’d resume recommendations.
The Biden Era: Big Green Promises, Big Tax Incentives
Under the Inflation Reduction Act of 2022 (IRA), instituted under the Joe Biden Administration, the U.S. government made a massive push toward clean energy and sustainable manufacturing. Tax credits and deductions were carved out for everything from solar installations to clean hydrogen to advanced manufacturing of critical minerals.
The Internal Revenue Service (IRS) lists a broad menu of “energy-related credits and deductions” for businesses, including the Clean Electricity Investment Credit and Clean Fuel Production Credit.
For example, one press announcement noted that the Biden-Harris Administration allocated $4 billion in tax credits to support clean energy manufacturing projects in 35 states. From a tax-strategy point of view, when the government says:
“We’ll subsidise this type of investment with generous tax breaks,”
it gets my attention. For businesses willing to enter manufacturing, supply-chain, or “green” infrastructure realms, the incentives looked compelling.
But Here’s the Flip Side: Resource Demands and Hidden Requirements
One key part of my caution: I realised that many so-called green initiatives still rely heavily on natural resources, global supply chains and heavy industry — things we often associate with “non-green.” For example:
- Manufacturing electric vehicles, aerospace components, defence equipment, data-centres (for AI) or even large-scale renewables requires lots of metal (lithium, cobalt, copper), rare earths, sophisticated electronics, supply-chain logistics, and sometimes heavy energy usage.
- Interestingly, the AI boom (think large language models, cloud data-centers, GPUs, servers) is itself driving demand for more infrastructure, more chips, more power. So even when the goal is “clean tech,” the underlying assets may be industrial, resource-intensive and subject to commodity-risk.
From a tax-strategy lens: if someone invests into something labelled “green” but the project is heavy on resource cost, labour, metals, global logistics, and relies on subsidies that may shift — the risk profile rises.
My job is helping business owners manage tax savings and manage risk. So when I see increased resource complexity, I lean conservative.
Enter the Trump Transition: Policy Uncertainty and Credit Pull-Backs
My second concern deepened when I looked closer at the transition under the Donald Trump administration (second term in this scenario). With the shift came a marked change in the tone, pace and direction of green-energy policy. One piece of legislation, the One Big Beautiful Bill Act (OBBB), accelerated the phase-out of key renewable energy tax credits and introduced tougher “foreign entity of concern” requirements for sourcing components for wind and solar projects.
Reports indicate that under this policy direction, federal support for wind and solar is being pulled back — not just slowed. For example: the White House published a policy statement declaring a goal to “rapidly eliminate … green energy subsidies” for so-called unreliable, foreign-controlled sources.
In plain terms: If you invest today expecting one set of tax incentives under one administration, and then the policy picture flips, the tax strategy has more unknowns. That uncertainty makes me hesitant to recommend green-heavy strategies to clients unless they have high risk tolerance and long timelines.
Why Manufacturing, Auto, Aerospace, Defence & AI Still Need “Traditional” Resources
Here’s where I draw from real world experience advising business owners: The sectors I see growing in 2025-26 are not only renewables in isolation — they’re industries like manufacturing, auto/EV, aerospace, defence contracting and AI infrastructure. All of those rely on natural resources, heavy manufacturing and global supply chains.
For example:
- Aerospace and defence often use specialty metals, high tech alloys and precision manufacturing.
- Auto/EV manufacturing needs battery minerals, aluminium, copper and electronics.
- AI infrastructure (large language models, data centres) needs servers, power, cooling, construction, electronics.
From a tax perspective, the structuring of entities, depreciation of FF&E (furniture, fixtures & equipment), accelerated cost recovery, and real-estate depreciation all become crucial. If a business is leasing an EV manufacturing line or building out a data centre, I might be far more interested in depreciation and cost recovery than in waiting for a green tax credit that may or may not stay the same.
Putting It Together: Why I’m Taking a Break from Recommending “Green” Investments
Here’s the summary of why I’ve pulled back on recommending green investments for now: The combination of shifting tax-incentive policy, reliance on heavy resources and supply chains, and increased uncertainty means the risk of over-promising tax savings is higher.
When I work with a business owner, I want to steer them toward strategies where we can have high confidence in downside protection—not just upside potential. When the upside depends on elusive or shifting credits, I am more guarded.
That doesn’t mean I think green investing is dead. Far from it. It means I’m waiting for clearer signals: stable policy, clearly defined incentives, predictable timelines and tax structures we can integrate confidently into entity and business-growth strategy.
What Would Make Me Re-Start Recommending Green Strategies?
I’d resume recommending green-related entity strategies when a few of the following align:
- A clear federal tax-credit regime (with minimal risk of major legislative reversal)
- A business model that is rooted in manufacturing/supply-chain advantage (not just “green idea”)
- Solid cost structure, proven resource sourcing and depreciation/write-off opportunity built in
Entity structure (LLC, S-Corp, C-Corp) aligned with tax strategy and business growth rather than subsidy-chasing only
In short, when I can recommend to you a structure that anticipates tax reduction and risk management.
What That Means for You as a Business Owner
If I were sitting with you right now (as I often do with my clients at Weston Tax Associates), here’s how we’d apply this thinking:
- We’d review your business model: Are you in clean tech manufacturing, EV supply chain, data centres, or purely service-oriented?
- We’d ask: What tax incentives are you relying on? Are they stable? Are they guaranteed?
- We’d build a structure (entity type, cost allocation, depreciation schedule) that doesn’t depend solely on an incentive that might change.
- We’d map risk: If incentives vanish or scale back, what happens to your margins, tax position, entity liability?
- We’d position you for growth in the “resource-heavy, infrastructure-adjacent” space if you like green tech — because that’s where I see more certainty right now.
So if you’re thinking “I want some green-investment tax strategy,” You need to know this: It’s not off-the-table. But I’m suggesting you do it with a stabilized base, and not as a speculative sideline.
Final Thoughts
In the world of tax strategy, we’re always chasing two things: savings and stability. The “green” wave has been exciting, and there are still huge opportunities. But when subsidy regimes shift, when resource demands and manufacturing realities intrude, when political winds flip — that’s when the tax risk creeps in.
So until I see the signals align more clearly, I’m recommending pause or at least extreme caution on green-investment strategies that depend heavily on government incentives.
Instead I’m steering business owners toward entity structures and cost-recovery strategies that are more within our control.That’s how you reduce tax and reduce risk.
Welcome to the New Age of Accounting. Let’s begin.
P.S. If you found this article helpful, you’ll love my new book S-Corp Mastery: How Smart Business Owners Maximize Tax Savings & Build a Lasting Legacy. It’s now live and available in a sleek, easy-to-read PDF version. Grab your copy here
Chris is the Managing Partner at Weston Tax Associates, a best-selling author, and a renowned tax strategist. With over 20 years of expertise in tax and corporate finance, he simplifies complex tax concepts into actionable strategies that drive business growth. Originally from Sweden, he now lives in Florida with his wife and two sons.
