Analysts Say Trump Trade Wars Would Harm the Entire US Energy Sector, From Oil to Solar

Why is that this battle occurring? The brief model is that Trump and his advisers consider that tariffs will assist the US financial system by encouraging development of factories right here, decreasing commerce deficits and punishing boundaries to entry of US merchandise in different nations.

“We’ll supercharge our home industrial base,” Trump mentioned in an April 2 speech saying tariffs on practically each US buying and selling associate. “We’ll pry open overseas markets and break down overseas commerce boundaries and finally, extra manufacturing at dwelling will imply stronger competitors and decrease costs for shoppers.”

A tariff is a tax charged by a authorities on imports. Because the US authorities has elevated its tariffs, different nations have retaliated with their very own will increase.

Including to the chaos is that the insurance policies continuously change, with the president typically saying shifts on social media, as occurred in latest days on tariffs on the European Union.

I spoke with Chris Seiple, Wooden Mackenzie’s vice chairman for energy and renewables, to drill down on the components of the report that take care of renewables. Right here is that dialog, edited for size and readability:

Dan Gearino: For renewable vitality industries, is the massive downside that tariffs make every part costlier, or is there extra to it than that?

Chris Seiple: Certain, issues getting costlier is an enormous a part of it. I believe the second problem, and that is sort of distinctive to the facility enterprise, is that there’s a heavy hand of regulation. And so there’s lots of US utilities that should undergo fairly intensive regulatory processes to get approval for what they wish to construct. Being in a world the place there’s a lot tariff uncertainty, they don’t know what it’s going to value to construct what they wish to construct. It’s significantly difficult for this business to have the ability to navigate that, and it impacts renewables greater than it impacts, say, different sectors like fuel or coal, as a result of we depend on imports of apparatus to such a much bigger diploma, particularly for battery storage, the place we’re primarily fully dependent at this level on imports from China.

With battery storage, there was an try to extend manufacturing capability within the US. How would you characterize the place that stands?

Very early days. Loads of battery manufacturing that’s occurring inside the US is supposed to produce batteries to EV automobiles, not stationary utility-scale storage initiatives. And so the quantity of producing capability compared to what the demand is for that gear ends in us importing properly greater than 90 % of what we’d like.