What do the tariff wars mean for low-carbon energy? | Recorded live at Wood Mackenzie’s Solar & Energy Storage Summit
Apr 25, 2025
30:13
AI Summary
AI Chapters
Episode notes
auto_awesome
Podcast summary created with Snipd AI
Quick takeaways
The uncertainty surrounding tariffs and tax credits is causing energy companies to adopt varied strategies, with some opting to stockpile resources to mitigate potential impacts.
Despite current market volatility, the solar and storage sectors are poised for growth driven by technological advancements and increased energy demands.
Deep dives
High Demand for Batteries in Automotive and Energy Sectors
The automotive and battery energy storage industries are experiencing a surge in demand for batteries, primarily driven by the expansion of electric vehicles (EVs) and grid-scale energy projects. In 2022, the demand for batteries in the EV sector outstripped previous expectations, leading to significant production increases to meet this need. Despite the high demand, uncertainties remain regarding tariffs and trade relations, prompting some companies to stockpile batteries in preparation for potential pricing shifts. This stockpiling, particularly in solar panels, indicates a proactive approach to navigating the evolving market conditions.
Navigating Uncertainty: Tariffs and Tax Credits
Uncertainty surrounding tariffs and tax credits poses significant challenges for businesses in the energy sector. Many companies are hesitantly deciding whether to proceed with projects or pause in anticipation of future policy changes, especially regarding the Investment Tax Credit (ITC) and the Production Tax Credit (PTC). The industry is divided, with some corporate off-takers choosing to delay decision-making while others rush to secure projects to take advantage of existing subsidies. This environment has sparked discussions about how to effectively manage procurement strategies amidst the volatility.
Impact of Trade Policies on U.S. Manufacturing
U.S. energy manufacturing is under scrutiny due to trade policies that could affect competitiveness against countries like China, which dominate battery production and raw materials. Concerns arise regarding the future of domestic production capabilities as companies navigate the complexities of tariffs and foreign partnerships. While the U.S. has made strides in achieving some self-sufficiency in solar module production, the path to scaling up battery cell manufacturing remains fraught with uncertainty. Stakeholders agree that developing a robust domestic supply chain is critical, but progress is hampered by the need for clear policy direction and investment incentives.
Future Opportunities in Solar and Storage Industries
Looking ahead, the solar and storage industries are poised for growth, driven by increased energy demands and advancements in technology. Industry leaders believe resolving bottlenecks in interconnections, labor availability, and regulatory processes will be essential for capitalizing on opportunities. The ongoing discussions around effective policies and tax credits are seen as crucial for ensuring sustainable development in these sectors. Ultimately, optimism remains strong, with anticipation for innovations that could enhance performance and efficiency in both solar and battery technologies.
“With great uncertainty comes great opportunity”, says Abby Ross Hopper, president and CEO of the Solar Energy Industries Association, in this special episode of the Energy Gang, recorded live at Wood Mackenzie’s Solar & Energy Storage Summit.
Is she right? And what are those opportunities? To find out, host Ed Crooks welcomed Abby and Shyam Srinivasan, CEO and Co-Founder of Zitara Technologies, for a special discussion on the state of the solar and storage industries today.
Uncertainty is the buzzword of the moment: uncertainty over tariffs, over tax credits, over the evolution of AI, and over the economic outlook. The Trump administration’s new tariffs are disrupting supply chains and prompting companies to delay investment decisions. At such a volatile time, it’s easy to be caught out by a sudden change in policy.
Companies have different strategies for coping with all this uncertainty. Some have been stockpiling solar panels; a few have been stockpiling batteries. And all the while, there are some powerful global trends still driving the industry: overproduction in China that is still driving down costs, and the need for new electricity generation of all types to power data centers for AI.
Abby, Ed and Shyam debate the uncertain policies and forecasts that are making companies hesitant to invest, and find some pointers to help navigate through the storm. And they lift their eyes from the day-to-day chaos to consider what are the real opportunities for the longer term once the immediate crisis is over.
