How Trump’s tariffs could impact solar
The cost of going solar could increase this year.
As President Trump starts his second term in the White House, speculation about tariffs is making headlines left and right. If Trump does go through with imposing some, or all, of the tariffs he’s said he plans to enforce, it’s likely that the cost of going solar will increase for the homeowners across the U.S.
For a better understanding of how new tariffs may impact the solar industry, let’s take a look at how Trump’s previous tariffs affected the solar industry and what it tells us about the types of trade policies we may see from the latest Trump administration.
The first Trump administration made enforcing tariffs a key part of its trade policy. In 2018, Trump imposed Section 201 tariffs on solar panels, aiming to bolster American manufacturers. While American solar panel manufacturing did see an expansion, installation costs for homeowners escalated.
During President Trump’s first term, the solar industry saw an increase of 128%, reaching 100 gigawatts (GW) of installed solar. However, according to the Solar Energy Industries Association (SEIA), the effects of these tariffs also saw some negative impacts:
Tariff increases led to 62,000 fewer solar jobs
Installation prices for homeowners increased
$19 billion in new private sector solar investment was lost
During his four years in office, former President Biden expanded on the tariffs that were originally imposed during the first Trump administration. In 2024, Biden raised tariffs on photovoltaic cells from 25% to 50%, and imposed anti-dumping laws meant to stop U.S. companies from importing underpriced solar imports.These changes presented a challenge for the solar industry by impacting the availability and cost of solar equipment.
Increase in Section 201 and Section 301 Tariffs
In 2024, the Biden administration increased Section 201 tariffs on specific Chinese imports. Under the CHIPS Act, this increase included certain solar panel components, such as the silicon used in solar cells. At the end of the year, the U.S. Trade Representative’s office also announced a 25% increase on Chinese-made solar wafers and polysilicon. Duties on certain tungsten products also rose from zero to 25%. Those hikes went into effect on the first day of January 2025.
Enforced Anti-dumping Laws
The Biden administration also enforced anti-dumping laws and countervailing duty investigations in 2024 in major solar manufacturing countries, including Cambodia, Malaysia, Thailand, and Vietnam. Those laws are meant to prevent foreign solar panel manufacturers from flooding the U.S. market.
While he didn’t follow through with his promise to impose new tariffs on his first day in office, the likelihood that tariffs will increase during the next four years is high. Less than a week into his term, Trump has already claimed that he’ll add an additional 10% tariff on Chinese goods starting Feb.1.
But this shouldn’t be considered an immediate threat to the solar market, said Aaron Nichols, a marketing and advocacy specialist at Exact Solar. “Tariffs are like the game whack-a-mole. As soon as you crack down on manufacturing in one country, another springs up to take its place,” Nichols said.
What happens over the next four years is anyone’s guess, but Nichols thinks it’s possible that domestic manufacturing could become a requirement to receive a tax credit, for example, or that tariffs on lithium-ion solar batteries could rise to 25% much sooner than the expected 2026 timeline.
Solar is still a smart investment
Despite potential increases in costs and installation, solar is still a smart investment and a growing industry. Since 2000, more than 219 gigawatts (GW) of solar capacity has been installed nationwide, which is enough to power over 37 million homes.
According to Nichols, solar is still a great “long-term choice for homeowners and business owners looking to cut energy costs and contribute to the stability of our electric grid.” Shifts in policy will impact the cost of solar in the short term, “but that doesn't change the fact that solar technology is cheaper, more efficient, and more reliable than it's ever been.”
Fewer imports from China could disrupt the supply chain
In 2025, experts like Adam Bushell, director and electrician at AB Electrical & Communications in Sydney, Australia, say we should “expect a period of transition in which households may encounter delays or increased expenses while the sector changes.”
An increase in tariffs on Chinese-made solar products likely means an increase in production costs and limited inventory for the short term. However, they may benefit America’s solar manufacturers by reducing competition.Without solar equipment coming in from other countries, American companies will have to work to stabilize the supply chain and meet consumer demand.
“An expanded domestic supply chain could ultimately stabilize prices,” Nichols says, “but that transition could take years. In the short term, it would likely shrink the market.” So while these increases may mean it will be harder to get solar equipment quickly in 2025, it could mean a more sustainable solar supply in the long run.
New tariffs will likely increase upfront costs
Both new and higher tariffs mean the cost of installing solar is likely to rise in 2025. While some of Trump’s tariffs went into effect on the first day of the year, solar costs probably won’t rise immediately. If you plan on installing solar in 2025, Bushell recommends that homeowners begin gathering quotes as soon as possible, “since locking in contracts before tariffs have a significant impact on price and may save them money.”
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