Analysts warn of looming risks to US battery storage under Trump
From pv magazine USA
Donald Trump will be inaugurated as US president on Jan. 20, 2025, and analysts predict that his administration will bring sweeping changes to the clean energy landscape.
A new report from Clean Energy Associates highlights five potential risks to the battery energy storage industry, including risks to EV batteries, grid-scale storage, and home battery energy storage.
1) Antidumping / countervailing duty enforcement
A new antidumping and countervailing duty (AD/CVD) petition was filed in December 2024 against imports of a critical battery material, anode active material (AAM), from China.
Anodes made with Chinese AAM and batteries would be subject to duties, which on average in recent orders have exceeded 100% of the cost of imported goods. About 74% of AD/CVD petitions result in new duties imposed on importers.
Clean Energy Associates said there is a high likelihood of this outcome, with a moderate impact on the market. It expects action to take place as soon as Feb. 16, 2025.
2) UFLPA battery detentions
Trump has nominated Marco Rubio as secretary of state, which Clean Energy Associates said brings elevated risk to far-reaching and more severe enforcement of the Uyghur Forced Labor Prevention Act (UFLPA).
Battery importers placed on the UFLPA list are faced with a rebuttable presumption that the product is contaminated with a supply chain that participated in forced labor. It can be very difficult to prove no finding of forced labor under a rebuttable presumption, meaning that most suppliers placed on a UFLPA list would be barred from bringing product to the United States.
This outcome, which would require action from the president, is considered highly likely to occur and is a high impact risk, said Clean Energy Associates. The report said UFLPA battery supplier enforcement could begin as soon as February 2025.
3) Section 301 60% tariff
Based on campaign promises, the Trump administration is expected to increase Section 301 tariffs to 60% on multiple goods from China. A 60% tariff would force battery procurement away from Chinese suppliers to South Korean and Japanese suppliers and generally increase prices, said Clean Energy Associates.
The company added that this outcome is likely and will have a moderate-to-high impact on the market as soon as March 2025.
4) Tariffs on Section 232 battery supply chain
Reuters has reported that Trump’s transition team has suggested adding tariffs to EV battery and supply chain tariffs under Section 232. Clean Energy Associates said the proposed tariff levels are unknown, but could include battery energy storage systems.
Clean Energy Associates sees this as a moderate likelihood of occurring, with a moderate-to-high market risk, occurring in the first quarter of 2026 or later.
5) Erosion of Section 48 Investment Tax Credit
Clean Energy Associates said it finds a full repeal of the Section 48E Investment Tax Credit (ITC) unlikely. However, there is a distinct possibility it may be phased out as early as 2027, instead of in the mid-2030s. This shortening of the tax credits would likely take place as part of the bill reconciliation process.
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