USA: “Solar power is here to stay”

VDE dialog: The Trump administration’s policies are quite erratic, but one thing the president made clear is that he doesn’t like renewable energies. Is this stance already having an impact on your work?

Brian Grenko: The thing about erratic behavior is that it keeps people guessing. The problem, however, is that political and regulatory uncertainty causes investors to “stay on the sidelines”. A sharp decline in available capital subsequently causes project and technology development activities to come to a screeching halt. Fewer projects being constructed and operated means less revenue for our business.

Cherif Kedir: The critical point of note is the current climate of uncertainty. This is creating a slowdown in the industry, as several manufacturers are scaling back operations in reaction to developers delaying or canceling purchase orders.

It is worth noting the administration’s efforts to bring manufacturing back to the United States. It’s a logical and understandable goal as a long-term strategy. Still, in today’s world of tariffs and specialized manufacturing equipment that’s located almost entirely in China, there are several hurdles to overcome. Several companies that had planned to set up factories in the United States are reconsidering their plans, as the prices of essential equipment have surged and investment plans are now on hold.

The solar industry in the US has grown a lot in recent years. Do you think under Trump it will continue to grow, or will only the fossil fuel industries benefit? In other words: does the administration have the power to stop the development?

Brian Grenko: Thanks to many years of continuous improvements in technology and economies of scale, the cost of solar energy is cheaper than coal and natural gas in most parts of the United States, in some places without any financial incentives. That's a very compelling statement for our industry. If you are a utility company selling electricity to homeowners, how do you make an argument to your ratepayers that they should pay higher rates for fossil fuels? While any government administration can take steps to blunt the growth of renewables, solar power is here to stay and will only continue to grow.

The Inflation Reduction Act (IRA), passed in 2022 under Trump’s predecessor Joe Biden, supported the renewable energy industry with billions of dollars. It is currently being reviewed. What happens if the administration repeals the IRA?

Cherif Kedir: Since its enactment in 2022, the Inflation Reduction Act (IRA) has formed the backbone of U.S. industrial and clean energy policy. By early 2025, it had leveraged more than $600 billion in private funding, created over 400,000 new jobs across approximately 750 projects, and garnered substantial “match” funding from the private sector. At its heart, the IRA is an opportunity to reorient spillovers from the international trading system, creating incentives for domestic manufacturing based on the awarding of clean energy tax credits and production subsidies—a system of tools that replaces the hammer of tariffs with the lever of long-term industrial competitiveness.

And if the current administration manages to dismantle or even weaken the IRA as much as the 2025 Reconciliation Bill passed by the House proposes. In that case, it will deal a blow to US manufacturing and the development of renewable energy. It would also have the effect of eliminating necessary tax credits for the production and investment in “clean electricity,” as well as expediting prohibitions on projects involving “prohibited foreign entities.” Such changes risk hollowing out these incentives, which have motivated company investments in U.S.-based manufacturing.

There is a pervasive and widely held myth that tariffs are a sustainable substitute for subsidies. Indeed, tariffs frequently pass the cost on to domestic firms. For instance, not too long ago, we were forced to stop importing a key piece of equipment from China, valued at $500,000, because import duties at the time would have increased it to $ 1.75 M. That’s not a cost to levy against the exporter; that’s a direct cost to us. In many cases, the specialized equipment we require is not even manufactured in the U.S., so these tariffs are not only costly but also self-defeating.

Finally, by repealing the IRA, we would not only threaten job creation and economic growth but also make it much more difficult for U.S. companies to compete with global competitors in areas such as clean energy and advanced manufacturing. The way forward involves increasing domestic capabilities by providing smart, targeted incentives, so we can all compete on a level playing field — not by erecting barriers that harm American businesses.

You have laboratories all over the world, including China – could it be a strategy for the future to work more outside the US than before?

Cherif Kedir: We are continuing to expand our global footprint, particularly as we operate in an increasingly complex energy and trade landscape, which is something that makes strategic sense.

The United States remains one of the most lucrative and strategically critical markets for photovoltaic (PV) producers. Strong demand, supportive policy environments, and healthy margins render it a hot spot for solar investment. And beyond profits, the U.S. market also serves as an essential vector for domestic manufacturing and overarching national energy objectives.

Solar is now one of the most competitive sources of new power, and utility-scale solar across the country has reached new record-low prices. Increasingly, it’s becoming as cheap or cheaper to install and operate a solar or wind power plant than a coal or natural gas power plant. This cost advantage is necessary to achieve energy independence and create a more reliable, sustainable grid.

From what I understand, that's what this administration wants: to protect the US market.

Cherif Kedir: Yes, that does appear to be the administration’s goal — insulate the U.S. market with tariffs. However worthy the aim of bolstering domestic industry may be, the means are deeply troubling.

Tariffs are being used not only to adjust trade imbalances but also as a bargaining tool. The problem with this strategy is that it injects tremendous uncertainty into the global economy. Although I do not have direct insight into the administration’s plan, tariffs are being used to pursue a range of goals. The trouble is that the long-term implications of this strategy are not entirely clear.

High tariffs are not a solution. And they often end up harming the very companies they’re supposed to serve by raising the price of critical imports, especially in industries where domestic substitutes do not exist. This has knock-on effects throughout supply chains, discourages investment, and can ultimately lead to inflationary pressures and reduced competitiveness.

What we’re witnessing at the moment is a state of economic tension that, left to fester, may have significant implications worldwide. It’s in everyone’s interest — both domestic and international — to reach a solution that puts stability back in place. I am hopeful that we will reach a balanced, forward-looking agreement before these policies cause even further economic harm. If a recession is triggered, the path to recovery could be significantly longer and more challenging.

Brian Grenko: Part of the narrative here is that there's been a disintegration of the manufacturing sector in the US economy in recent decades. That's really at the heart of trying to bring back domestic jobs. Addressing this issue was a primary goal of the Inflation Reduction Act. It's important to note that most of the new factories constructed in the short period of time since that legislation was passed are in “red states” loyal to Republicans, the party of Donald Trump. It’s also true that the majority of utility-scale solar power generation facilities are constructed in rural locations that tend to lean Republican. This means those people prospering the most from new manufacturing and/or construction jobs tend to vote Republican. Ironically, if the administration takes steps to slow the growth of solar, they would be hurting those in their own political party the most.