New Solar Tariffs, Policies to Impact Solar Prices, Industry’s Future

new solar tariffs to impact solar prices, industry future

The Biden-Harris Administration recently announced significant solar tariffs and solar policy measures to bolster American solar manufacturing and protect the industry from unfair trade practices by China. These solar tariffs and other policy moves could affect solar prices and change the direction of the solar industry’s future.

This blog post will explore these actions in detail, their impact on the solar industry, and how they could influence homeowners considering solar installations.

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New Solar Tariffs & Policy Changes

The Biden-Harris Administration has introduced a series of significant policy changes aimed at strengthening American solar manufacturing and counteracting unfair trade practices by China. These new measures, which include increased tariffs, the removal of certain import exclusions, and additional incentives for domestic production, are poised to reshape the solar industry.

Here is a breakdown of these new solar tariff and solar policy changes:

1. Increased Tariffs on Chinese Solar Imports: President Biden has directed an increase in tariffs on solar cells and modules from China, doubling the rate from 25% to 50%. This action aims to protect American manufacturers from unfair competition due to China’s subsidized solar products. The increased tariffs would make solar panels imported from China more expensive and make American-made solar panels more affordable in comparison.

2. Removal of Bifacial Module Exclusion: The administration plans to remove the bifacial module exclusion under Section 201. This exclusion allowed bifacial solar panels, typically used in utility-scale projects, to avoid safeguard tariffs. The bifacial solar exclusion removal will offer increased protection to US manufacturers and provide support for the developing US solar manufacturing industry.

3. End of the Solar Bridge: The temporary duty-free import bridge for certain solar products from Southeast Asia will end as scheduled in June 2024. This bridge facilitated robust solar deployment while domestic manufacturing ramped up. US solar manufacturing and deployment have grown dramatically in the meantime, and the end of the duty-free import will further support this growth.

4. Monitoring Import Surges: To prevent market oversaturation, the administration will closely monitor solar module imports from Southeast Asia, where circumvention of antidumping duties has been identified. This will shield US solar manufacturers from unfair trade practices that could undercut the competitiveness of American-made solar panels.

5. Domestic Content Bonus Guidance: The Inflation Reduction Act (2022) contains a bonus tax credit available to developers of clean energy projects that meet certain statutory requirements for sourcing iron and steel products and manufactured products from domestic producers. Further guidance on the IRA’s domestic content bonus will help clean energy developers and manufacturers leverage the bonus tax credit more effectively.

How Will These Changes Affect the Solar Industry?

The new solar tariffs and policy changes introduced by the Biden-Harris Administration are set to have a significant impact on the solar industry. By increasing tariffs and removing certain exclusions, these measures aim to boost domestic manufacturing and competitiveness, protect American jobs, and encourage investment in the solar supply chain.

Here are the main ways the solar tariffs and solar policy changes will affect the solar industry:

Boost to Domestic Manufacturing: By increasing tariffs and removing exclusions, these measures are designed to protect and stimulate American solar manufacturing. This is expected to lead to more investments and growth in the domestic solar supply chain. Overtime, this could mean greater domestic solar competition, more solar options for consumers, and more affordable options for those who want to install solar panels.

Research and Development: Over $70 million will be invested in solar research and development to advance US competitiveness in solar technology. The advances in solar technology that result from this research and development could have a huge impact on the solar industry. Future solar panel technology advances could mean solar panels that are more efficient, cheaper to produce, easier to recycle, and more affordable and easier to install.

Support for Solar Component Manufacturing: Funding from the 48C Advanced Energy Projects credit will support new manufacturing capacities and upgrades to existing facilities. This increase in solar panel manufacturing capacity could increase domestic solar panel supply, decreasing solar prices and driving future solar demand.

How Will These Changes Affect Homeowners Who Want to Install Solar Panels?

The new solar tariffs and policy changes will have several implications for homeowners interested in solar panels. These measures aim to boost domestic solar manufacturing and protect US jobs, which could influence the cost and availability of solar panels in the short term. Additionally, enhanced incentives and advancements in solar technology promise long-term benefits.

Here are the main ways solar tariffs and solar policy changes will affect homeowners interested in installing solar panels:

Potential Cost Increases: Homeowners might see short-term price increases for solar panels due to higher tariffs and reduced imports. However, as domestic production ramps up, prices may stabilize and lead to more affordable domestic solar panel options.

Enhanced Solar Incentives: The Inflation Reduction Act’s domestic content bonus and other incentives will make solar installations more affordable and accessible, particularly for low-income households. Learn more about solar incentives and see which you qualify for.

Advanced Solar Technologies: Investments in solar R&D will likely result in more efficient and durable solar technologies, benefiting homeowners in the long run. These advances in solar technology could result in solar panels that are more efficient, cheaper to produce, easier to recycle, and more affordable and easier to install.

Economic and Environmental Benefits: New solar tariffs and solar policy updates could lead to greater domestic economic growth and environmental benefits. By supporting US solar manufacturing, these policy changes will mean more solar jobs and solar manufacturing companies. It will also mean fewer imported solar panels from overseas, reducing transportation pollution and environmental damage resulting from lax or nonexistent foreign environmental policies. And by investing in solar, homeowners contribute to job creation in the local economy and reduce their carbon footprint, supporting a sustainable future.

What Should Homeowners Do Now If They Want to Install Solar Panels?

The immediate impact of new solar tariffs will likely mean increase solar prices for homeowners who want to install solar panels. Increase solar tariffs could increase solar prices as foreign-made solar panels become more expensive. It’s uncertain how long these price increases might last until domestic solar production and technology can catch up and provide cheaper prices.

In the long-term, solar prices might decrease as a result of increases domestic solar panel manufacturing and competition. Future solar technology developments could also lead to more efficient and cheaper solar panels. However, this manufacturing capacity, competition, and technology are still decades away. In the meantime, solar prices will likely increase.

As solar prices likely increase as result of tariffs, solar incentives will provide some relief. Solar incentives, such as the 30% solar tax credit, as well as many state, local, and utility incentives will help cover the cost of installing solar panels and jumpstart solar savings.

The best advice on installing solar panels is to install early. Solar prices are expected to increase in the near future, and energy price inflation will mean higher energy bills for you and your family. Instead of paying higher and higher energy bills long into the future, install solar panels now and start saving. The more energy price increase, the more you save. And the earlier you install, the quicker you will see your savings.

Get your free solar quote today. Contact Green Ridge Solar today to get your free solar analysis.

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