US photo voltaic tariffs may drive Asia transition growth
By Sara HUSSEIN
Bangkok (AFP) Might 4, 2025
Large deliberate US duties on photo voltaic panels made in Southeast Asia may very well be an opportunity for the area to ramp up its personal long-stalled power transition, specialists say.
Earlier this month, Washington introduced plans for hefty duties on photo voltaic panels made in Cambodia, Vietnam, Thailand and Malaysia.
The levies comply with an investigation, launched earlier than US President Donald Trump took workplace, into “unfair practices” within the international locations, significantly by Chinese language-headquartered companies.
If authorized subsequent month, they may pile upon tariffs already imposed by the Trump administration, together with blanket 10-percent levies for many international locations, and 145 p.c on Chinese language-made items.
For the US market, the results are more likely to be extreme. China makes eight out of each 10 photo voltaic panels globally, and controls 80 p.c of each stage of the manufacturing course of.
The brand new tariffs “will virtually make photo voltaic exports to US not possible commercially”, mentioned Putra Adhiguna, managing director on the Power Shift Institute suppose tank.
Southeast Asia accounted for practically 80 p.c of US photo voltaic panel imports in 2024.
And whereas funding in photo voltaic manufacturing has ramped up in america lately, the market nonetheless depends closely on imported parts.
For Chinese language producers, already coping with a saturated home market, the raft of tariffs is probably very dangerous information.
Many shifted operations to Southeast Asia hoping to keep away from punitive measures imposed by Washington and the European Union as they attempt to shield and nurture home photo voltaic industries.
The proposed new duties vary from round 40 p.c for some Malaysian exports to an eye-watering 3,521 p.c for some Cambodia-based producers.
– Tariffs ‘speed up’ transition –
However there could also be a silver lining for the area, defined Ben McCarron, managing director at Asia Analysis & Engagement.
“The tariffs and commerce struggle are more likely to speed up the power transition in Southeast Asia,” he mentioned.
China will “supercharge efforts” in regional markets and push for coverage and implementation plans to “allow quick adoption of inexperienced power throughout the area”, pushed by its exporters.
Analysts have lengthy warned that international locations within the area are shifting too slowly to transition from planet-warming fossil fuels like coal.
“On the present tempo, it (Southeast Asia) dangers lacking out on the alternatives offered by the declining prices of wind and photo voltaic, now cheaper than fossil fuels,” mentioned power suppose tank Ember in a report final yr.
For instance, Malaysia relied on fossil fuels for over 80 p.c of its electrical energy era final yr.
It goals to generate 24 p.c from renewables by 2030, a goal that has been criticised as out of step with world local weather targets.
The tariff regime represents a double alternative for the area, defined Muyi Yang, senior power analyst at Ember.
Thus far, the native photo voltaic business has been “largely opportunistic, targeted on leveraging home sources or labour benefits for export positive aspects”, he instructed AFP.
Reduce off from the US market, it may as a substitute concentrate on native power transitions, dashing inexperienced power uptake regionally and driving a brand new market that “may function a pure hedge towards exterior volatility”.
Nonetheless, changing the US market is not going to be straightforward, given its dimension and the comparatively nascent state of renewables within the area.
“Success hinges on turning this export-led momentum right into a homegrown cleantech revolution,” mentioned Yang.
“Clearance costs” could also be engaging to some, however international locations within the area and past can also be cautious a couple of flood of photo voltaic, mentioned Adhiguna.
Main markets like Indonesia and India have already got measures in place meant to favour home photo voltaic manufacturing.
“Many will hesitate to import massively, prioritising commerce steadiness and goals to create native inexperienced jobs,” he mentioned.
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