February 3, 2025
4 I will read the smallest
Trump tariffs cause fear of clean -energy supply chain confusion
Trump’s new tariffs in Canada, Mexico and China may attack electric vehicles, solar power, battery, and wind industries.
President’s new tariffs in Canada, Mexico, and China can collide with solar, battery, wind power, and electric vehicle industry.
ClimateWire | Clean energy has steadily cheaper for many years, thanks to research facilities and factory global networks.
It’s over.
The decision of President Donald Trump on Saturday to hit the sudden tariffs of Canada, Mexico, and China has shown the birth of a new World Trade system. And clean energy is a bit of a player in the President’s trade war, but tariffs can hit solar, battery, wind, and electric vehicle industries especially.
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David Victor, a professor of innovation and public policy at California University in San Diego:: “Probably, we will introduce a lot of uncertainty about the reliability of international rules on trade investment.
Trump orders, which will be enforced on Tuesday, have a 25 % tariff on products from Canada and Mexico, which imposes 10 % of the imports of China. Collection of 10 % of Canadian oil imports decreases.
The White House fact seat published on Saturday night is called the “leverage powerful and proven leverage source”. The order may significantly raise the price of the product because organizations such as the US Chamber of Commerce and the Institute of Petroleum are concerned about the impact on the US economy.
“The energy market is very integrated, and free and fair transactions across our borders are important to provide affordable energy to US consumers.”
This tariff is born when the clean energy industry competes to replace fossil fuels, the main factor of climate change, to reduce costs.
Trade is an important reason behind the recent decades of clean -energy costs worldwide. According to Lazard, an investment bank, the average cost of storage for utility scales has decreased by 83 % after 2009 and 2024, even after the bumps after Coving Solar Cost. The cost of land winds decreased by 65 % in the meantime.
Customs duties threaten those profits. “I am concerned that the increase in energy production costs will reduce energy costs in consumer energy costs and reduce the abundance of energy,” said American Clean Power Association, a trade group. 。
“The fuel depends on the energy of the wind and the sun (which is complemented by the storage of the battery), but some of these machines that use these renewable resources are manufactured in Canada and Mexico.” The group added.
According to international energy agencies, about three -quarters of the world’s lithium -ion batteries are made in China.
Many of the components used in land and wind turbines are made in Japan, but Canada and Mexico supplies many steels used in the United States. Steel accounts for almost 75 % of the mass of wind turbines.
Mexico is an emerging hub for the production of electric vehicles. General Motors manufactures all electric chevrolet leather and Equinox models south of the border. Canada, on the other hand, accounts for about half of the sophisticated nickel, an important component consumed in the United States.
Canada, China, and Mexico are all major manufacturers of electric grid components such as transformers, circuit breakers, and switch gears, and are necessary to upgrade grids to promote clean energy growth.
According to Gernot Wagner, a climate economist at Colombia Business School:
It is not a new thing that Trump focuses on tariffs. The Biden administration also exercised the target tariffs of Chinese electric vehicles and solar power generated by Southeast Asian Chinese companies. These measures have been a long -standing tension in world trade. Wagner said that the government and companies are comparing the low cost generated by trade in addition to the additional resilience that evacuate domestic industries.
However, when Biden tried to target tariffs, he combined them with generous subsidies for domestic clean energy manufacturers. In contrast, Trump promises to reduce the expenditure to clean energy and targets renewable energy, electric vehicles, and other low -carbon technologies.
Unlike Biden, Trump thrown a wide net with his tariff.
“Such a full intervention is expensive,” Wagner said.
He said the tariff could be backed by Trump. The petroleum industry is to be a great loser due to the expansion of trade barriers that can boost the cost of gasoline and diesel. The fossil fuel industry is less flexible than the clean energy industry of emerging companies that are not soaked in supply chains. For example, the manufacture of solar panels is easier than overhauling the proclaimed crude oil in Canada.
But analysts said that it was cold and comfortable for clean energy companies. Probably, the biggest impact of Trump’s movement is the uncertainty they creates, complicating the calculation of companies in where to invest.
“We may see quite a lot of counterattacks, but we will continue the basic continuous erosion of the rules that the government restricted to impose tariffs,” said UC San Diego Victor. I did it. “It can end up really terrible for the world’s trade systems and to be honest, for the US economy.”
