Status: DEVELOPINGApr 17, 2025, 3:55 PM

U.S.-China Solar Trade Tensions Continue to Impact Costs and Supply Chain Amid Domestic Manufacturing Growth

Despite tariffs raising costs and causing purchase delays, U.S. solar manufacturing capacity grows 190% in 2024, signaling resilience

Location: United States of America

Event Type: Economic | Confidence: 96%

Key Developments

China supplied at least 80% of solar panel components globally as of 2022, including polysilicon, glass, and solar cells.
President Trump's 2018 tariffs on imported solar cells and modules aimed to reduce U.S. reliance on Chinese components but increased costs for U.S. solar projects.
The U.S. has invested $18.2 billion, largely via the Inflation Reduction Act, to develop a domestic solar supply chain reducing Chinese dependency.
Trade tensions and tariffs have raised solar panel and component costs, affecting manufacturers and consumers internationally and domestically.
Tariffs and trade policy uncertainty have caused some U.S. solar customers to delay purchases, negatively impacting small and mid-size solar installers.
In 2024, U.S. solar module manufacturing capacity grew 190%, with cell manufacturing reshored for the first time in five years, indicating a strengthening domestic solar manufacturing base despite trade challenges.

The trade tensions reflect ongoing U.S.-China economic competition and efforts to reduce strategic dependence on Chinese supply chains.

The Biden administration's investments aim to balance trade policy with domestic industry growth and energy security.

Sustained trade tensions could drive further reshoring of solar manufacturing to the U.S.

Cost increases may slow solar adoption, affecting U.S. climate goals and energy transition timelines.

Higher solar panel costs and purchase delays may slow adoption of clean energy, impacting climate change mitigation efforts.

Supports tariffs and domestic supply chain investments to reduce Chinese dependency

Role: Policy maker

Credibility: High

Dominates global supply chain with 80% component share

Role: Global supplier

Credibility: High

U.S. policymakers: View tariffs and investments as necessary for strategic autonomy and economic security.

Bias Assessment: May understate short-term cost impacts on consumers.

Solar industry customers: Face higher costs and uncertainty, leading to purchase delays.

Bias Assessment: Focus on immediate economic impacts, may underappreciate long-term supply chain benefits.