The solar sector in the United States is predicting a significant slowdown in project instals this year due to global supply chain issues and the potential of new U.S. tariffs on panel imports from Southeast Asia.

Southern Co, a U.S. power utility, announced on Thursday that almost a gigatonne of its planned solar energy projects will be delayed by a year, the latest in a series of warnings from firms and industry officials citing the two difficulties.

A slowing in the expansion of the solar business might jeopardise the Biden administration’s climate ambitions, which include decarbonizing the US power sector by 2035 through widespread use of wind and solar energy.

“I share your deep concern about this,” Energy Secretary Jennifer Granholm said on Thursday while testifying at a congressional budget hearing. She was responding to a lawmaker’s question about the threat of new tariffs on solar installations.

Southern Chief Financial Officer Daniel Tucker stated on a conference call to review the company’s quarterly results that the company’s Georgia Power utility gained regulatory approval last week to postpone several solar projects by a year.

According to a regulatory document, the delay relates to five planned solar installations in Georgia totaling 970 megawatts of capacity. That is enough to power 184,000 houses.

According to regulatory records, the projects are being developed by Nextera, EDF Renewables, and Consolidated Edison. Georgia Power has signed 30-year contracts to purchase power from several facilities. Southern has pledged to achieving “net zero” carbon emissions by 2050, in part through utilising substantial amounts of solar energy.

NextEra announced this week that about 2.1 to 2.8 GW of its solar and energy storage projects would be delayed from 2022 to 2023. The business mostly blamed the Commerce Department’s trade investigation into alleged tariff evading by Chinese panel makers, which was begun last month and potentially result in duties on solar panels from four Southeast Asian nations that account for over 80% of imports into the United States.

Because the tariffs could be enforced retroactively, the probe, which could take months to complete, has created uncertainty in the solar business.

The leading solar trade association announced earlier this week that it was lowering its solar installation predictions for this year and next by 46 per cent owing to the potential of new tariffs.

According to the Solar Energy Industries Association, more than 315 projects have been cancelled or postponed.

Tariff concerns have contributed to a slew of issues for US solar companies, including rising component, labour, and freight prices as the global economy recovers from the coronavirus outbreak.

(Adapted from EconomicTimes.com)

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