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U.S. solar industry warns of slowdown due to supply chain disruptions, tariff uncertainty -Breaking

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© Reuters. FILEPHOTO: A grid of solar panels is set up in Northfield Massachusetts on Earth Day (April 22, 2022), U.S. Photograph taken by a drone. REUTERS/Brian Snyder

(Reuters) – The U.S. Solar industry warns of a slowdown in solar project installation this year due to global supply chain disruptions, and new U.S. tariffs affecting panel imports from Southeast Asia.

U.S. power company Southern Co (NYSE: ) Thursday’s announcement that nearly a gigawatt in its solar projects planned for delay by one year was the latest in a series of warnings issued by companies and representatives from the industry citing both of these issues.

Slowing growth in the solar sector could threaten the Biden administration’s climate goals. These include decarbonizing U.S. energy sectors by 2035, through widespread adoption and wind/solar energy.

While testifying during a hearing on the congressional budget, Jennifer Granholm, Energy Secretary said that “I share you deep concern about it.” Responding to a question from a legislator about new tariffs for solar installation, she said:

Southern Chief Financial Officer Daniel Tucker stated that the Georgia Power utility received approval from regulators last week, allowing it to postpone several solar projects for a year.

According to regulatory documents, the delay in November 2024 is for five solar plants that are being built in Georgia. They have a combined capacity of 970 megawatts. This is enough power to power 184,000 homes.

According to regulatory documents, the projects are being designed by Nextera (EPA:: Renewables), Consolidated Edison and EDF (EPA:: Renewables). Georgia Power is able to purchase the electricity from such facilities through 30-year contracts. Southern is committed to cutting its carbon emissions to zero by 2050. Partly, this has been accomplished by purchasing large amounts of solar electricity.

NextEra stated last week that it expects about 2.1 to 2.83 GW of solar and storage projects’ output to change between 2022-2023. The U.S. Commerce Department launched a trade investigation into Chinese panel maker’s alleged tariff dodging last month. It could have led to tariffs for solar panels made from four Southeast Asian countries, which account roughly 80% of US imports.

This investigation will continue for several months and could cause uncertainty on the solar market as the tariffs may be retroactively implemented.

This week’s largest solar trade organization announced that its annual solar installation forecasts were being cut by 46%, citing the risk of tariffs. According to the Solar Energy Industries Association, more than 315 projects have been cancelled or delayed.

U.S. developers of solar panels are facing a host of problems due to tariff issues. These include rising costs for parts, labor, and freight while the world economy recovers after the coronavirus pandemic.

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