2026 Preview: 2025 Challenges May Prompt US Solar Industry to Regroup in New Year
The U.S. solar industry, which sustained a number of setbacks in 2025, could regain its footing in the new year.
A look at OPIS’s DDP U.S. spot price assessment for imported utility scale TOPCon modules from Jan. 7 ($0.282/watt-peak) to Dec. 9 ($0.293/wp) failed to capture the sheer amount of change underway in the solar power sector at home and abroad.
Before President Trump took office in January, pro-solar language in the Inflation Reduction Act was starting to bear fruit in the form of a record number of solar installations and new demand for domestically produced equipment. The industry expected the growth to continue through the end of the decade.
But the Trump administration made it clear early on that it aimed to repeal the IRA and other sources of renewable energy incentives, which it dubbed the “Green New Scam.”
It succeeded in pulling back phaseout schedules, rewriting safe harbor rules and federal permitting guidelines and adding new eligibility restrictions to “foreign entities of concern.” A rush to safe harbor projects’ eligibility will likely drive another short-term burst of demand through 2026, but that is expected to level off as government incentives disappear.
The administration also began a near-universal trade war in 2025 by imposing reciprocal tariffs on imports from a majority of countries. Southeast Asian countries with significant solar manufacturing were especially hard hit.
And in the spring, Vietnam, Cambodia, Malaysia and Thailand were hit with new high tariffs following the completion of an anti-dumping/countervailing duties probe. U.S. trade officials opened another AD/CVD probe a few months later into Indonesia and Laos, where many suppliers moved to avoid previous investigations, as well as India.
An investigation into whether imported polysilicon has impacted national security is also ongoing and could have wide-ranging cost impacts. China dominates the global supply chain and U.S. capacity in the U.S. is limited to a few players.
These new tariffs are widely viewed as protectionist measures designed to support domestic manufacturers, but whether they can soften the impact of losing the domestic content bonus with the phaseout of the Inflation Reduction Act’s investment tax credits remains to be seen.
Any new tariffs could create headaches for the majority of U.S. manufacturers, given domestic upstream component manufacturing still lags behind module assembly capacity. But gaps in the supply chain should ease somewhat by late next year.
The U.S. could add nearly 15 GW of module plants in 2026, bringing domestic nameplate capacity to more than 70 GW, according to an OPIS analysis. There could be some 27 GW of cell capacity in the U.S. and 10 GW of wafer capacity in the U.S. by the end of 2026. And a new polysilicon plant is also in the works.
Given the current uncertain value proposition of producing upstream components in the U.S., it’s unlikely the new year will bring announcements of new U.S. factories. Instead it appears more likely that a few companies may decide to cut their losses and walk away from domestic production plans.
Next year also may feature more joint ventures between Chinese and U.S. firms or sales of Chinese-owned factories stateside, as companies restructure to meet new “foreign entity of concern” restrictions that are to take effect at the start of the year. More detailed guidance on implementation is expected from the federal government.
JA Solar in July sold its 2-GW Arizona module assembly plant to Corning Materials. And on Dec. 1, Canadian Solar said it was creating a subsidiary, CS PowerTech, to oversee its U.S. manufacturing and sales operations.
U.S. International Trade Commission import data for cells and modules showed the impact of AD/CVD investigations. According to numbers through July, imports from Laos, Indonesia and India exceeded those from regional neighbors Vietnam, Malaysia, Thailand and Cambodia in the spring and early summer when new rates on AD/CVD 3 countries dropped.
It’s widely expected that import data for the second half of 2025 and into 2026 will show a similar drop in Laos, Indonesia and India and a rise in Africa and Middle Eastern countries as the game of whack-a-mole approach continues.
Prices Appear Set to Increase in New Year
U.S. tariff investigations could push module prices higher in 2026, regardless of origin.
The continuing AD/CVD probe is focused on in countries still reeling from Trump’s reciprocal tariffs. And while it’s difficult to say what the final rates will be–and how pricing will be impacted–the aftermath of the most recent AD/CVD investigation completed in the spring may offer some hints.
In that proceeding, trade officials spring confirmed dumping rates that were similar to those seen a year earlier when the investigation began.
This time, officials are alleging dumping rates of 123% for India, 94% for Laos and 123-190% for Indonesia.
Just before the final determinations were released in the spring AD/CVD case, OPIS assessed the average cost for a cargo of TOPCon modules from Southeast Asia at $0.263/wp. That price rose to $0.277/wp in early August, and near year’s end was at $0.293/wp.
Given the U.S. solar industry’s ongoing reliance on Southeast Asia for upstream components, the previous AD/CVD case also led to price increases in the U.S. OPIS heard average quotes of 30 cents for TOPCon modules assembled in the U.S. with imported cells in early June. By late in 2025, that number was at 32.6cts.
Imported module prices could edge above 30cts/wp in 2026 and U.S. assembled prices could approach or exceed the mid-30cts/wp. New restrictions under the Foreign Entity of Concern rules could also shrink the pool of acceptable suppliers, squeeze supply on both sides of the Pacific, and push prices up.
Procurement sources have expressed much more concern about the potential effect of the Section 232 investigation into imported polysilicon, saying there is less precedent from which to draw potential outcomes. Officials could target only Chinese producers or all foreign polysilicon producers. Either scenario would restrict supply and lead to higher costs for end users.
Reporting by Colt Shaw, cshaw@opisnet.com; Editing by Jeffrey Barber, jbarber@opisnet.com