Mike Summers had been looking forward to setting up solar panels at his Ohio home for a long time. Finally, after replacing his old roof this year, his solar contractor got to work and installed a system with 19 panels and a battery backup. Summers feels fortunate to have completed the project at the right time. As a former mayor of Lakewood, near Cleveland, Summers is set to receive $10,000 in tax credits for his $39,000 investment. Equally important to him was the fact that all the equipment was easily accessible.
However, others aiming to go solar may face challenges in the near future. President Donald Trump’s trade conflict with China could hinder the availability of solar panels and components, potentially driving up project costs. China has been a major supplier of solar panel materials, such as polysilicon, glass, and solar cells, accounting for around 80% of these components as of 2022. The solar industry also relies on critical minerals, with China playing a significant role in global supply chains.
Despite efforts to develop a domestic supply chain worth $18.2 billion in recent years, led by the Inflation Reduction Act under former President Joe Biden’s administration, the U.S. may struggle to replace Chinese production. The escalating tariffs are affecting both international and domestic manufacturers, leading to increased prices and uncertainties for customers in the solar market.
The impact of these trade tensions is evident in rising costs for residential solar projects. As a result, smaller installers may face financial difficulties, potentially reducing solar adoption rates. The evolving trade policies make it challenging for companies to provide pricing stability, ultimately affecting their ability to attract customers.
While solar technology has become more affordable over the years, the shifting trade landscape is causing disruptions in the industry. As solar costs have decreased significantly since 2010, the uncertainty surrounding trade policies is casting a shadow over the future affordability and accessibility of solar energy.
According to the National Renewable Energy Laboratory, American consumers have also been able to take advantage of credits that reduce costs further, although the future of these credits is uncertain under the Trump administration. Commercial and utility-scale project costs have significantly decreased, fueling rapid growth across the U.S. in the past two decades. In 2024, the commercial segment grew by 8% and the utility segment by 33%, as reported in the annual Wood Mackenzie report. However, the residential segment saw a 32% decline last year, which experts attribute to high interest rates and election uncertainty. Solar energy is crucial as a clean energy source as it does not emit harmful greenhouse gases like coal, natural gas, and oil, which are major contributors to global warming.
During his first term, Trump imposed tariffs on imported solar cells and modules in 2018 to reduce reliance on China. In response, China subsidized its own domestic production, and some U.S. manufacturers accused China of shifting operations to Southeast Asian countries with tariff exemptions. Abigail Ross Hopper, president and CEO of the Solar Energy Industries Association, stated that the U.S. is working to regain control of the supply chain from China to establish a strong solar manufacturing base. The group reported a 190% growth in module manufacturing capacity in 2024, with cell manufacturing reshored for the first time in five years as Suniva resumed production.
However, Hopper expressed concerns that abrupt policy changes could deter investment and hinder job creation, particularly for manufacturers. The group criticized the tariffs issued during the first Trump administration as detrimental to the industry. Despite these challenges, there is encouragement for individuals considering installing solar panels to act promptly.
For more climate coverage from AP, visit http://www.apnews.com/climate-and-environment. Alexa St. John is an Associated Press climate reporter. Follow her on Twitter: @alexa_stjohn or contact her at ast.john@ap.org. The Associated Press’ climate and environmental coverage is supported by various private foundations, and AP maintains full responsibility for all content. To learn more about AP’s standards for working with philanthropies and see a list of supporters and funded coverage areas, visit AP.org.
