U.S. sets new tariffs and floors on solar inputs

The United States has introduced a new trade policy targeting the polysilicon supply chain, aiming to reshape the economics of imported solar and related products. The policy centers on a 15% ad valorem tariff applied to polysilicon derivatives, covering downstream products that use polysilicon as a key input. Alongside the tariff, the policy establishes binding minimum import prices at multiple stages of the supply chain, setting a more structured cost floor for foreign-origin material entering the U.S. market.

The new regime is scheduled to take effect on December 4, 2026. Its design reflects an effort to address trade and national security concerns by targeting not only final solar modules but also intermediate products such as ingots and wafers that are central to global photovoltaic manufacturing.

The proclamation sets specific minimum import prices across the polysilicon-to-module chain. For raw polysilicon, imports will be subject to a floor of $21 per kilogram. Polysilicon ingots and wafers will carry a higher threshold of $100 per kilogram, directly affecting upstream materials used in solar cell production.

Further downstream, the policy imposes a minimum import price of $0.22 per watt for solar cells and $0.38 per watt for solar modules or panels. These floors work in tandem with the 15% ad valorem tariff on derivatives, creating a combined framework that limits how low imported prices can go, regardless of global market conditions or producer pricing strategies.

Analysts cited in reporting project that the new minimum price for imported modules could lift landed costs meaningfully. One projection estimates that directly imported finished modules could see prices rise from about $0.24 per watt to about $0.38 per watt once the floors are in place. Such an increase would affect procurement calculations for solar developers that rely heavily on imported modules.

Higher import costs could influence power-purchase agreement structures and project economics if alternative sources do not expand quickly. The policy’s structure, which combines tariffs and price floors, is intended to reduce incentives to circumvent duties through partial processing or shifting production steps, tightening conditions on low-cost imports across the value chain.

The proclamation authorizes the Commerce Department to develop incentive programs aimed at encouraging companies to invest in U.S. polysilicon production and downstream manufacturing. These incentives are intended to build domestic capacity in foundational materials and components critical to solar manufacturing and other technologies that rely on polysilicon.

The measures build on a Section 232 national security investigation into polysilicon imports that was launched in July 2025. That investigation provides the legal basis for treating the reliability and control of the polysilicon supply chain as a national security matter, underpinning the combination of tariff measures and price controls.

Chinese officials have publicly criticized the new U.S. measures. Statements from Chinese embassy and foreign ministry representatives describe the action as an overstretch of national security rationale and accuse the United States of abusing state power.

These objections highlight growing tensions between the two countries over trade in clean energy components. With the U.S. establishing clear tariffs and price floors and China objecting to the policy’s framing under national security, the solar supply chain has become a focal point in broader trade and industrial-policy frictions.