New research finds the Trump administration’s tariffs are expected to have a limited impact on solar imports from Asia while raising costs for domestic developers, which American consumers will ultimately absorb. This is due to the U.S. solar industry’s dependence on imported cells to support module production.
The tariffs are projected to narrow the price gap between foreign and U.S.-made solar panels. However, domestic manufacturing costs will still rise, potentially slowing the growth of solar installations.
Industry experts predict the tariffs will hinder efforts to build a robust domestic supply chain, adding pressure to an already struggling sector.
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President Donald Trump’s tariffs are expected to have a limited impact on solar imports from Asia while raising costs for U.S. developers and manufacturers, which American consumers will ultimately absorb. This is according to a recent report from multinational research firm BMI.
What impact will tariffs have on domestic solar producers?
The American solar industry has long depended on imported cells to support domestic module production, leaving it vulnerable to pricing shifts. Preliminary duties proposed by the U.S. Department of Commerce will place rates ranging from 22% to 274% on Thailand, Cambodia, Malaysia and Vietnam. They are the top four countries from which the U.S. sources the majority of these components.
How might this impact the US solar industry?
While the BMI report notes these tariffs will also increase the price of Chinese solar panels by $0.10 to $0.15 per watt, narrowing the gap between imported and current U.S.-made modules, domestic manufacturing costs will still go up. The firm projects these increased costs will ultimately pass on to U.S. developers and consumers, potentially slowing the growth of solar installations.
“Since the US’s manufacturing capacity is insufficient to meet demand for solar, wind and grid components, we do expect that costs will increase for developers due to the tariffs which will now be imposed upon these components,” BMI wrote.
What happens next?
PV Tech reports this projection from BMI aligns with sentiment shared by U.S. solar officials last week. They said the tariffs would “undermine” the establishment and growth of a domestic supply chain.
“Overall, while the power sector may not be as adversely affected as others, these tariffs still pose further headwinds to a sector which has been badly affected since Trump’s return to office,” BMI concluded.
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