Why is that this battle occurring? The brief model is that Trump and his advisers imagine that tariffs will assist the US economic system by encouraging development of factories right here, decreasing commerce deficits and punishing limitations to entry of US merchandise in different international locations.
“We’ll supercharge our home industrial base,” Trump mentioned in an April 2 speech saying tariffs on almost each US buying and selling companion. “We’ll pry open overseas markets and break down overseas commerce limitations and finally, extra manufacturing at dwelling will imply stronger competitors and decrease costs for customers.”
A tariff is a tax charged by a authorities on imports. Because the US authorities has elevated its tariffs, different international locations have retaliated with their very own will increase.
Including to the chaos is that the insurance policies steadily change, with the president usually saying shifts on social media, as occurred in current 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 cope with renewables. Right here is that dialog, edited for size and readability:
Dan Gearino: For renewable power industries, is the large downside that tariffs make every thing costlier, or is there extra to it than that?
Chris Seiple: Certain, issues getting costlier is a giant a part of it. I feel the second problem, and that is type of distinctive to the facility enterprise, is that there’s a heavy hand of regulation. And so there’s a whole lot of US utilities that need to undergo fairly intensive regulatory processes to get approval for what they need 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 need 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 kit to such an even bigger diploma, particularly for battery storage, the place we’re basically completely 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. Plenty 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 tools leads to us importing nicely greater than 90 p.c of what we’d like.
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