Will tariffs kill solar? No politics, please

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Curious what the "peaker" factor of nuclear is... I know utilities have a grudge against solar and wind because they're so variable, and coal generation in particular is very bad about handling dynamic demand changes, while natgas can adapt quickly enough to accommodate those swings.
 
ModbusMan said:
Curious what the "peaker" factor of nuclear is... I know utilities have a grudge against solar and wind because they're so variable, and coal generation in particular is very bad about handling dynamic demand changes, while natgas can adapt quickly enough to accommodate those swings.
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Nuclear power plants ideally operate in the steady state. In fact if you had a power grid that was only supplied with nuclear power, you would probably need energy storage to compensate for the fact that consumption is highly variable.

Solar power combined with nuclear is a pretty good mix, IMHO.

Be careful about the assessment of 'transient' impact. The inflation rate is the slope of the price curve, so at the end of transient high inflation prices are permanently elevated. If you end inflation today, prices are still high and will stay high. To bring prices down you need negative inflation, which _can_ have its own problems.
 
It's hard to evaluate the situation since we seem to whipsaw back and forth on tariff, no tariff, tariff on this but not that, etc. The effect at the customer end really depends on how much of the installation is materials versus labor, and if the ancillary component such as rails, frames, roof hardware et al are also under the tariffs. If 50% of an installation is tariff goods and we see 25% tariffs, the cost pass through would be 12.5%.

We are a Siemens dealer and all Simens alarm equipment is made in China, except for the enclosures. Siemens has not announced any significant price hikes due to the tariff issue.

The critical item is, can US manufacturers compete even with tariffs in place? I see a 100w solar panel from Harbor Freight for $120. If the price goes up to $150, can a US firm make a panel for $150?
 
gadfly56 said:
The critical item is, can US manufacturers compete even with tariffs in place?
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Only if the tariffs are so high that it would be more expensive to manufacture and ship a product across the ocean. The Chinese have proven that they can make things really cheap just look at Temu. And Americans have demonstrated that they want cheap products. Just look at the country of origin for most of the stuff at Walmart.
 
They won't kill solar but they will give it a firm kick in the nuts. Even if local production ramps up the logic of supply and demand means that domestic prices will rise as high as the market will bear, which is likely just a few percent below the newly tariff induced prices for Asian modules. No matter how you slice it prices will go up and although they may settle a bit they will remain much higher than they are now.
 
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I thought that one of the infrastructure bills passed a couple years ago gave favorable tax treatment for installing domestically-produced equipment. And in response, some panel production was already being initiated in the US. Of course, any raw material used in those panels that is imported would be impacted.
It’s been too long since this transpired for me to remember any more than that. Maybe I dreamt the whole thing. 😆
 
Problem beyond can we manufacture it here (with factories having been shuttering for decades), is that even the raw materials for the majority of the stuff is not even available here. Years of NIMBY coming to bite us. Some of the minerals are not even minable here and must be imported, so what do you do with that. This morning saw a 104% tariff on Chinese imports, and now just heard that it was bumped to 125%. Most MFG and retail have all been behaving as the oil industry, as soon as there is the slightest unrealized scare the price jumps, but will take months to come back down once it is unfounded, and never back to what it once was.
I'm already getting some customers that have asked for work now backing out of having it done or putting it on hold with a wait and see attitude. In the last 3-6 months have had 75% either reduce scope or just outright cancel, supposedly fear and or cost of materials climbing and market diving. That level of drop is unsustainable when my insurances are based off the last audit period when operating at full capacity.
 
All the solar companies I have worked for or with (8 or 10, I'd guess) have been running on such thin margins that for them it was always sell volume or die. All but a few of them died, and that was when things were good.
 
jaggedben said:
It makes no sense to treat the tariffs as a given, because that situation changes weekly. See?
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There was a major announcement that caused the biggest swing in the stock market in 5 years 2 hours after you started this thread! So which numbers do you want us to use?

This cannot be a productive conversation in this forum.
 
The stock market is only one aspect of the tariffs. The actual time that it takes for these changes to become apparent will be days, weeks, and months from now.
 
infinity said:
The stock market is only one aspect of the tariffs. The actual time that it takes for these changes to become apparent will be days, weeks, and months from now.
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I appreciate that many realized my original post was not political, but just stating the current facts. It took a few edits to make sure it stayed that way. Here is another that is not political and just stating the current facts on the ground and some recent personal experience.

Another factor is the chaos. It is impossible to plan in chaos. All you can do is react and hope you don't have to react to something outside the bounds of what you are capable to reacting to.

Couple anecdotes...

I'm buying a new carpet for my dining room. The room is an odd shape, so the carpet needs to be made with a template and the edges bound. Just got the quote maybe 10 days ago and then they told me last week I had 7 days to pay in full or the quote was invalid. I don't blame them for trying to bound their exposure.

Bought some LSL 2x4's yesterday from a local lumber yard (think of it like a 2x4 made from OSB -- it is very straight). Talked to my rep there and she said they are already seeing price increases.

That's the other bad thing about chaos. Companies use the chaos to raise prices and they go up a lot faster than they will ever come down. The price of uncomplicated stuff like panels is still whacked.
 
tthh said:
Another factor is the chaos. It is impossible to plan in chaos. All you can do is react and hope you don't have to react to something outside the bounds of what you are capable to reacting to.
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I've thought for a while that taxes could be higher (to match spending) or spending could be lower (to match taxes), and either would be fine as long as there was stability.


-Jonathan
 
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jaggedben said:
It makes no sense to treat the tariffs as a given, because that situation changes weekly. See?
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What I see is that increased tariffs on imported PV modules are a reality and not likely to go away any time soon. I do not see why we cannot discuss the effects they might have on our industry without getting into the weeds about who did what to whom because, frankly, it is irrelevant. Whether one thinks that tariffs are in general a good thing or a bad thing is also irrelevant. I respectfully request that we stay clear of that third rail because when it gets into the mix political noise drowns out all other discussion and gets threads shut down.

Yes, it is a dynamic situation. I am retired from full time employment in the solar industry but I am concerned for its continued viability, and I am interested in how those of us who are still in the business are handling what is happening.
 
ggunn said:
I am concerned that the escalating trade war with China will kill the solar industry in the US. Without getting in to the politics of the situation (please!) and simply looking at the tariffs at face value, will the tariffs on Chinese imports raise the prices on solar modules to US solar companies so much that it will render PV projects in this country economically nonviable?
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I believe the prices are already 30% higher just before and after the tariffs were implemented.
It can't help but affect the industry and consumers decisions to buy
 
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Tariffs will make solar equipment (mostly imported) cost more, which will make solar more expensive in the US.
No way around that.

But HOW much more?
It will not "kill" solar, just push some to not go solar.

In economics, all the various implications and variables must also be considered.

#1 TRINA 405W panels are now 29c/W. Let me repeat that: twenty nine cents!
So for fun, add 100% tariff: 60c/W. Is that what we paid 2 years ago?
(I paid $4.20/W for BP175s 15 years ago.)

#2 How much of the BOS ....... rack, wire, batteries and inverters .......come from abroad?

#3: Is this just a temporary negotiation strategy? In which case it will all turn out OK. In time.

#4: If we view the tariffs as just one of many huge tax changes to come, then the net effect of all the tax changes must be weighed. Trump may in fact slash or eliminate (!) income tax (never done before), corporate tax etc and reinstate high tariffs as the tax source for the govt.
This was the policy before 1913.
We could keep more of our income........ but would need to spend more on some imports. So WHO KNOWS.

#5 electric rates are insane. 17% increase last year alone. 30-50c/kwh in some areas. That helps us a lot. It is not about absolute costs of solar but relative cost or opportunity costs.

All basic stuff ya all know, but bears spelling out.
Interesting time.
 
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ModbusMan said:
Curious what the "peaker" factor of nuclear is... I know utilities have a grudge against solar and wind because they're so variable, and coal generation in particular is very bad about handling dynamic demand changes, while natgas can adapt quickly enough to accommodate those swings.
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A "grudge"??

Depends on which sector your in..

Generation isn't wild about it because they have to call on dispatchable sources to cover for peak times, which in some markets occur after sunset.
Ours is 3-6 PM (average) in summer and 6-8AM in winter.
Unless the panels are following or oriented to the sunset the solar production is falling off when it's needed most.
Distribution likes it because it helps out so much on loading, especially when backfeeding lines. We have solar that will carry an ENTIRE 4 circuit substation (conditions have to be right, stars line up, etc) and push back through transmission to another station. On a sunny day with no load (spring) it can feed two subs..

We did have a condition a couple of years ago where we had to drop load. "Brown outs" if you will.
Started about 7:30 on a cold morning. We were switching circuits on and off every 15 minutes.
Estimated times were guessed to do this until about 11AM.
Once the solar started producing about 9-9:30, it helped tremendously and we stopped turning anything off by 9:30-9:45.
 
ggunn said:
What I see is that increased tariffs on imported PV modules are a reality and not likely to go away any time soon. I do not see why we cannot discuss the effects they might have on our industry without getting into the weeds about who did what to whom because, frankly, it is irrelevant. Whether one thinks that tariffs are in general a good thing or a bad thing is also irrelevant. I respectfully request that we stay clear of that third rail because when it gets into the mix political noise drowns out all other discussion and gets threads shut down.

Yes, it is a dynamic situation. I am retired from full time employment in the solar industry but I am concerned for its continued viability, and I am interested in how those of us who are still in the business are handling what is happening.
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My thoughts: First, I dont think tariffs will be that high. I think he is rapidly losing this negotiating tactic after threatening and then backing down over and over. Second, if we assume whatever the tariffs settle at is "not that high" (pick a number, say 15%), does that really increase the cost of a system much? Say modules are 30 cents/watt now, and an additional 15% of that makes them 34.5 cents/watt. A total system is maybe $3/watt.
 
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