News > Panel production fight could impact your ability to go solar

Panel production fight could impact your ability to go solar

• Energy democracy & policy

June 8, 2022

America is trying to build its home-grown solar manufacturing capacity. The challenge is how to do so without disrupting the current supply chain. This supply chain relies heavily on foreign-made solar panels and parts.

At issue is should the United States levy tariffs on solar panels manufactured by Chinese companies? This has been a question in the industry for more than a decade.

Tariffs on solar

In 2012, the Commerce Department placed a tariff on Chinese-manufactured solar panels. The Commerce Department ruled that Chinese companies were selling solar panels at below cost. They did so to corner the market on solar.

This issue surfaced again earlier this year. U.S.-based solar panel manufacturer Auxin Solar filed a petition with the Department of Commerce. It asked the Department to determine if Chinese companies moved manufacturing to third-party countries as a way to avoid tariffs.

The countries in question are:

• Cambodia,
• Malaysia,
• Thailand, and
• Vietnam.

These countries accounted for 85% of the solar power imported into the U.S. last year. The Commerce Department will issue a preliminary ruling in this case by the end of August.

Tariffs arguments, for and against

Tariff supporters believe the tariffs provide needed protections for domestic American manufacturing. They also cite concerns that some foreign-made panels may be manufactured using forced labor.

Tariff opponents see them as harmful to further development of the solar industry and achieving clean energy goals. They note that the vast majority of American solar jobs are in panel installation. Higher panel prices, they argue, are a threat to these jobs. They cite that hundreds of solar projects have been canceled or delayed since the investigation began.

Impact on rooftop solar

Tariffs have a greater impact on larger-sized solar projects. These projects are more price sensitive. Even a small increase in costs can ruin their economic feasibility.

Residential installations have felt the tariff threat as well. Installers in several states have told us that certain panels are unavailable. Installers have also reported unexpected price increases. These delays and cost increases trickle down to customers.

Administration puts pause on tariffs, for now

Earlier this week, the Biden Administration announced it would suspend any tariffs on the countries in question. This suspension is in place for the next two years. This should ease concerns over panel costs and availability in the near-term.

Informed consumers are a key component to a strong solar market. SUN will continue to follow the situation as it develops. We’ll make sure you have the information you need to make smart solar choices.