The Inflation Reduction Act was officially enacted into law.
So, we can finally put inflation behind us now, right?! Well, unfortunately, no.
However, there are a lot of wheels that were put in motion as a result of this bill’s passing.
Perhaps none more important than in the clean energy sector, where it amounts to the federal government’s biggest investment in combatting climate change to date.
But what is the fallout from a bill of this nature being passed into law?
As you know, there has been no shortage of attention paid to the effects of climate change and need to reduce our footprint.
Well, the reality is, with $369 billion dollars earmarked toward the development of clean energy tech and other climate-focused solutions, that money has to go somewhere.
While the solutions of the future don’t exist right now, there are a hoard of startups looking to develop them. Therefore, the market leader in 2030 – when the U.S. aims to slash carbon emissions in half – could be getting off its feet today.
So, what does this have to do with Bill Gates, as I mentioned in the headline?
The Microsoft mogul is no stranger to the world of clean energy investment. In fact, he launched Breakthrough Energy Ventures, which allocates funds toward clean energy startups. They, and by extension Bill, feel the passing of this bill is particularly pivotal for this market.
“Everybody wants to be a part of this,” Breakthrough Energy Ventures investment committee co-leader Carmichael Roberts told MSNBC. “The calls that I’m getting now – tremendous, already, and there was already a big groundswell around climate, but this just really boosted even further.”
Part of the most impactful fallouts from this bill are the tax credits allocated toward companies that manufacture in the U.S. As a result of these incentives, Bill’s firm believes there could be as many as 1,000 companies created that would have otherwise never existed.
“The venture capital dollars will flow in a lot faster from areas that may not have been investing,” Roberts said. “We’re going to have a real path to scale with the best and the brightest people, and the best companies being created. That’s what this bill overall does.”
This is music to angel investor ears, because, while the prevalence of VC investment could create marginal increases in competition, these increases figure to be more than offset by the increase in startups seeking funds.
As the government invests in the sector, private investors will follow suit.
In vintage if you build it, they will come fashion, the approval of these funds is an open invitation to innovators to seize the opportunity.
But they’re far from the only ones with an opportunity thanks to this bill.
Angel investors should be frothing at the mouth in anticipation of the startups that will enter the fold in coming years.
Just make sure you’re ready to capitalize.
The A&E Network Deals Team