Trump’s tariff war with China could brighten India’s solar prospects
The price of polysilicon, a key ingredient of solar panels, largely depends on whichever political party controls the US government.
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Over the past three years, the price of solar panels in the United States has fluctuated between an historic high and low due to a reliance on China. Now, as the Donald Trump administration imposes a long-threatened 10% tariff on Chinese imports, could America’s bid for freedom from the Chinese solar market prove a boon for India and Pakistan?
The price volatility of solar installations can only be understood through the Chinese and US trading relationship. The US was a leader in manufacturing polysilicon, which is used to make solar panels, until China enacted a 57% anti-dumping tariff against US polysilicon in 2013. For the next decade, the US solar market increasingly relied on Chinese expansions in polysilicon manufacturing to fuel its exponential growth. When US demand for solar skyrocketed during the pandemic, China was unable to keep up.
The shortage of raw material came against a backdrop of the urgent need to transition away from fossil fuels. As the demand for solar skyrocketed, prices increased by 50% in two years, says Andries Wanderwaar, solar analyst at US-based energy consulting firm Rethink.
Wanderwaar told Sapan News that it takes about two years to build a polysilicon factory and “bring more production capacity online”.
Conditions that created the polysilicon shortage are unlikely to...
