Solar Panel tariff increase?
It was revealed last week that the U.S will be imposing an increase of 30% on their tariffs on solar panel equipment imports. That means tariffs on about 80% of the supply that the renewable energy industry in the US relies on.
Since then, I have had a few homeowners ask me on my take on this whole solar power situation. Whether they should invest in solar power now before the tariff increase or should they wait? And how will it affect them as a homeowner?
How will this affect homeowners?
Here is my take on it, (By the way, this is nothing political whatsoever. I am looking at this on a neutral stand point. Purely economic perspective.) In the short term, yes, I do believe that things are going to get a little uncertain. Solar panel equipment prices will go up and jobs may be lost in the process. Considering this tariff, the Solar Energy Industries Association projects thousands of jobs to be lost.
In the long term, I believe we will be better off. Because of competition and innovation, companies will realize there is an opportunity to create better products at a cheaper price. We can see this trend in the electronics industry where new technology tends to be expensive and faulty at the beginning. But through competition, better products eventually come out at a more affordable price, therefore, benefiting homeowners’ pockets.
Not to mention, this tariff increase is meant to decrease as the years pass. Since it is a percentage base tariff, as imported prices fall, so will the tariff amount. The plan was approved to start at 30% in year one and drop to %15 by year 4.
Given the circumstances, it is a risk nonetheless, but worth it overall. Either way, you will get your money’s worth switching to renewable energy.