Home-passed federal tax laws threatens to undercut the photo voltaic business, which is the first supply of latest U.S. electrical energy era and is delivering a historic growth in home manufacturing
WASHINGTON, D.C. — The U.S. photo voltaic business added 8.6 gigawatts (GW) of latest photo voltaic module manufacturing capability in Q1 2025, marking the third-largest quarter for brand spanking new manufacturing capability on file.
The manufacturing surge comes from eight new or expanded factories in Texas, Ohio, and Arizona, in line with the U.S. Photo voltaic Market Perception Q2 2025 report launched yesterday by the Photo voltaic Power Industries Affiliation (SEIA) and Wooden Mackenzie. Along with rising module capability, U.S. photo voltaic cell manufacturing capability doubled in Q1 to 2 GW with the opening of a brand new manufacturing facility in South Carolina.
The report finds that the U.S. photo voltaic business put in 10.8 GW of latest electrical energy producing capability in Q1, and photo voltaic and storage account for 82% of all new producing capability added to the grid.
Whereas photo voltaic manufacturing and deployment proceed to steer American power independence and development, new tariffs and potential adjustments to federal tax credit pose important enterprise uncertainty for the business and threaten its long-term development.
“Photo voltaic and storage proceed to dominate America’s power economic system, including extra new capability to the grid than any expertise utilizing more and more American-made gear,” stated SEIA president and CEO Abigail Ross Hopper. “However our success is in danger. If Congress fails to repair the laws handed by the Home – which might render the power tax incentives unusable – lawmakers will set off a harmful power scarcity that may elevate our electrical payments and cease America’s manufacturing growth in its tracks. The Senate nonetheless has time to get this proper and safe President Trump’s imaginative and prescient for American power dominance.”
Financial system-wide tariff uncertainty, new anti-dumping and countervailing duties (AD/CVD) on cells and modules from Southeast Asia, and potential shifts in federal power incentives may considerably hinder U.S. photo voltaic deployment and manufacturing, risking power shortages, job losses, and manufacturing facility closures.
“The ten.8 GW of photo voltaic capability put in in Q1 2025 represents a good portion of latest U.S. electrical energy era, highlighting photo voltaic’s rising dominance within the power combine,” stated Zoë Gaston, Principal Analyst at Wooden Mackenzie. “Nonetheless, our evaluation means that the U.S. photo voltaic market has but to succeed in its full potential. The proposed adjustments to federal tax incentives, together with ongoing tariff issues, may considerably affect this development trajectory and probably result in power provide challenges. It’s essential to think about the crucial function of photo voltaic in America’s power panorama” added Gaston.
SEIA and Wooden Mackenzie’s forecast for the business, which accounts for tariffs levied in Q2 however not potential roll backs of the federal tax credit, tasks declining deployment nationwide, which may end in misplaced funding in native communities, power shortfalls, and elevated power payments for People. Whereas the neighborhood photo voltaic forecast remained flat, all different segments noticed their five-year outlook decline in comparison with final quarter, together with a 14% discount in forecasted residential photo voltaic deployment, and a 6% discount in forecasted utility-scale deployment. Rollbacks of the power tax credit, on prime of not too long ago levied tariffs, would unequivocally worsen the injury to the photo voltaic business.
A separate current evaluation performed by SEIA of the impacts of the Home-passed reconciliation laws tasks a devastating power scarcity for the U.S. economic system ought to the invoice turn into legislation. If lawmakers fail to alter course, 330,000 present and future People jobs may very well be misplaced, 331 factories may shut or by no means come on-line, and $286 billion in native investments may disappear. The invoice may additionally set off large power inflation, elevating shoppers’ electrical energy prices by $51 billion nationwide.
If Congress cuts power tax incentives, SEIA’s evaluation tasks that power manufacturing will fall 173 TWh and the US won’t be able to satisfy demand or compete with China within the world race to energy AI.
In response to the Photo voltaic Market Perception report, Texas continued to dominate, including extra photo voltaic capability than any state in Q1 2025, with the state of Florida surging forward of California for second place. Of the highest ten states with essentially the most photo voltaic installations within the first quarter, eight had been received by President Donald Trump within the 2024 election: Texas, Florida, Ohio, Indiana, Arizona, Wisconsin, Idaho, and Pennsylvania.
If Congress fails to change the adjustments to power tax incentives handed by the Home, jobs, investments, and factories in Trump nation will probably be hit the toughest.
Be taught extra at seia.org/smi.
Media Contact:
Rachel Skaar, Photo voltaic Power Industries Affiliation (SEIA), [email protected] | 406-461-9694
About SEIA®:
The Photo voltaic Power Industries Affiliation® (SEIA) is main the transformation to a clear power economic system. SEIA works with its 1,200 member firms and different strategic companions to struggle for insurance policies that create jobs in each neighborhood and form truthful market guidelines that promote competitors and the expansion of dependable, low-cost solar energy. Based in 1974, SEIA is the nationwide commerce affiliation for the photo voltaic and photo voltaic + storage industries, constructing a complete imaginative and prescient for the Photo voltaic+ Decade by means of analysis, training and advocacy. Go to SEIA on-line at www.seia.org and comply with @SEIA on Twitter, LinkedIn, and Instagram.
Press launch from SEIA.
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