New tariffs would stifle U.S. solar progress, says ACORE analysis

Antidumping and countervailing duties (AD/CVDs) are especially harmful to the solar industry, and potential new tariffs on solar cells and panels from Southeast Asia could raise U.S.-made module costs, according to a newly released analysis commissioned by the American Council on Renewable Energy (ACORE).

These higher prices, implemented on top of other headwinds, including domestic factors and trade restrictions already in place and impacting the industry’s trajectory, could seriously hinder America’s progress on solar deployment, the analysis written by Clean Energy Associates says.

“Today, solar is one of the most affordable and reliable energy sources we have to power our economy,” said ACORE President and CEO Ray Long. “Injecting uncertainty into the market slows economic growth and the good-paying jobs clean energy creates, undermines U.S. climate objectives, and will inevitably raise energy costs for American families.”

The new analysis shows that solar prices have already started to spike since petitions were filed with the U.S. Department of Commerce and the U.S. International Trade Commission on April 24.

The analysis concludes that potential new tariffs resulting from the AD/CVD investigations into solar cells and modules imported from Cambodia, Malaysia, Thailand, and Vietnam could increase costs to a level that significantly restricts solar supply and installations in America.

Specifically, the imposition of new, unpredictable AD/CVD duties on solar cells and panels from these countries could raise U.S.-made module costs by 10 cents per watt and imported module costs by 15 cents per watt, leading to net module purchase price increases for buyers.

In turn, projects with marginal economics may no longer meet investment criteria and become canceled, reducing deployment of PV projects, slowing U.S. climate goal progress, and negatively impacting deployment jobs, the analysis says.

“Some American consumers may be further impacted as PV module price increases translate to higher energy costs,” according to the analysis.

“This is not an appropriate course of action and could unintentionally cede U.S. leadership in the solar industry to other countries,” said Long.

The new analysis outlines how the U.S. solar sector is currently in good health with a fast-emerging domestic solar manufacturing supply chain. The U.S. solar industry must increase from 177 gigawatts (GW) of installed capacity to over 500 GW to meet the government’s target of a 50-percent to 52-percent reduction in greenhouse gas emissions by 2030

While the United States is actively building its solar module manufacturing capabilities, the researchers explain how more time is still needed, particularly to build cell capacity and meet demand.

And if additional tariffs on solar cells are imposed, American module manufacturers would likely be harmed as they rely on imported solar cells to meet their current production needs.

This could undercut the buildout of a strong domestic solar supply chain and jeopardize U.S. factories and the jobs they support, the analysts contend.

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