U.S. Solar Industry Faces Higher Costs as Tariffs Loom Under President-Elect Trump

With over 80% of solar panels in the U.S. coming from Southeast Asia, industry leaders fear that these trade policies could stifle renewable energy expansion, increase project costs, and force developers to delay or cancel installations. The shift in policy comes at a critical time, as the U.S. continues its transition toward cleaner energy sources.

Why Are Solar Costs Rising?

Two major factors are driving the rising costs in the U.S. solar industry:

1. President-Elect Trump’s Expected Tariffs

During his 2024 campaign, Trump pledged to reinstate and expand tariffs on imported solar panels as part of his broader “America First” economic policy. These tariffs are expected to resemble—or even exceed—the 2018 solar tariffs imposed during his first administration, which initially set a 30% duty on imported panels before gradually phasing down under President Biden.

Supporters of the tariffs argue that they will boost U.S. manufacturing, but industry analysts warn that higher costs for developers could undermine overall solar adoption.

2. New Antidumping Duties on Southeast Asian Imports

Separate from Trump’s anticipated trade actions, the U.S. Department of Commerce recently imposed antidumping and countervailing duties on solar panel imports from Vietnam, Malaysia, and Thailand—key suppliers that have dominated the U.S. market since previous tariffs were placed on Chinese-made panels.

These duties are meant to curb trade loopholes that allowed Chinese manufacturers to circumvent existing tariffs by assembling solar products in Southeast Asia. However, the move has already resulted in higher costs and supply constraints, affecting developers who rely on imported panels to keep projects on schedule and within budget.

Impact on the U.S. Solar Industry

The combined effect of higher tariffs and antidumping duties is expected to have far-reaching consequences for the U.S. solar industry:

🔹 Rising Prices for Solar Projects: Utility-scale solar projects, which depend on low-cost imported panels, will likely see cost increases of 10-20%, according to industry estimates. This could make solar energy less competitive with fossil fuels in the short term.

🔹 Slowdown in Solar Installations: The U.S. had been on track for record-breaking solar installations in 2025, but many projects could now face delays or cancellations due to rising costs and supply chain uncertainty.

🔹 Potential Job Losses: The solar industry employs over 250,000 workers in the U.S., and a slowdown in installations could impact jobs in construction, installation, and maintenance.

🔹 Setback for Clean Energy Goals: The Biden administration had set a goal of 100% clean electricity by 2035, but higher costs could slow progress toward that target, forcing utilities to rely on natural gas and other fossil fuels longer than expected.

Industry Reaction and Policy Debate

The solar industry and clean energy advocates have been quick to criticize the new trade policies, warning of unintended consequences.

• Solar Energy Industries Association (SEIA): “These tariffs will raise costs for American consumers and businesses, slow job growth, and set back our clean energy transition,” said SEIA CEO Abigail Ross Hopper.

• Renewable Energy Developers: Several major solar developers have already indicated they may pause projects or shift sourcing strategies to mitigate the impact of tariffs.

• Supporters of Tariffs: Some U.S. solar manufacturers support the tariffs, arguing that they will encourage domestic production and reduce dependence on foreign imports. However, even U.S. manufacturers rely on imported components, meaning they could also face higher material costs.

What’s Next for the U.S. Solar Market?

The outlook for the U.S. solar industry remains uncertain, with key questions looming over the next few months:

🔹 Will the Trump Administration Move Forward with Stricter Tariffs? While Trump has promised to bring back solar tariffs, industry leaders are watching closely for specific policy announcements after his inauguration in January 2025.

🔹 Can Domestic Manufacturing Scale Up Quickly Enough? If higher tariffs take effect, the U.S. solar industry may need years to scale domestic manufacturing to meet demand. In the meantime, costs could remain elevated, delaying the expansion of solar energy.

🔹 Will Developers Seek Alternative Supply Chains? Some solar companies are exploring alternative sourcing options, including India, South Korea, and Mexico, to reduce dependency on Southeast Asian imports.

Conclusion

The U.S. solar industry is facing one of its most significant challenges in years, as a new wave of trade restrictions threatens to increase costs, disrupt supply chains, and slow the expansion of solar power.