Tariffs, Solar, and the Unfolding Energy Dilemma in California

The Trump administration’s return to the political arena has brought with it a wave of policy revivals—including renewed efforts to shield American industries through tariffs. Among the most impactful are steep duties on solar panel imports from Southeast Asia, a region responsible for a significant share of the U.S. solar supply chain. The implications for the solar industry are complex, and in California—arguably the heartbeat of America’s clean energy transition and where Sunistics does the majority of its business—the stakes are particularly high.

At face value, these tariffs, which soar to over 3,500% on some Cambodian imports, aim to crack down on what U.S. trade officials have characterized as a circumvention of earlier restrictions on Chinese solar components. The rationale is straightforward: bolster domestic manufacturing and curb reliance on foreign-made materials. But the collateral damage may be far from negligible. Industry groups warn that increased costs on imported panels could delay projects, inflate budgets, and chill momentum just as the nation needs it most.

For years, the Golden State has led the country in rooftop solar installations, driven in part by its powerful combination of sunshine, sustainability ambitions, and rocketing utility prices. But now, the financial calculus for many businesses and nonprofits is shifting.

The cost of doing nothing, however, may be greater still.

Commercial electricity prices in California have doubled in some parts in the past five years, and volatility is likely to remain a feature, not a bug, of the state’s energy landscape. For businesses, especially those managing tight margins, and for faith-based organizations operating on donation-based budgets, these increases pose a material threat. Energy independence, once an aspirational goal, is increasingly an economic imperative.

And while the tariffs complicate short-term investment decisions, they do not eliminate the case for solar. Quite the opposite.

Incentive structures remain in place—federal tax credits (some of which may sunset in the near future), state-level rebates, and emerging financing solutions tailored for nonprofits are still active. Organizations like CollectiveSun are helping bridge the gap between mission and money, enabling churches, synagogues, and community groups to go solar without shouldering upfront costs. These models are proving critical in maintaining momentum amidst shifting policy terrain.

Ironically, the tariffs may accelerate innovation. With reliance on overseas panels under scrutiny, investment in domestic solar manufacturing is gaining traction. If handled wisely, this pivot could foster a more resilient supply chain and stimulate job growth in clean tech sectors. Several U.S.-based manufacturers have already announced plans to ramp up production capacity, a move that could eventually drive down prices and enhance long-term energy security.

The political backdrop, too, is not as polarized as some might expect. While the Republican base has historically aligned with fossil fuel interests, recent years have seen growing support for solar, particularly in rural and agricultural communities where self-sufficiency resonates deeply. In red states from Texas to South Carolina, solar farms are cropping up as quietly pragmatic responses to rising energy costs and aging grid infrastructure.

This evolving consensus—paired with California’s unmatched solar potential—could lay the foundation for a reinvigorated industry, if stakeholders can weather the current turbulence.

For now, though, the message is clear: delays could be costly. The combination of inflationary pressures, shifting incentives, and geopolitical uncertainty is unlikely to ease soon. For business owners and faith leaders considering solar, there may never be a perfect time—but there may also never be a better one than now.

As California confronts the dual challenge of climate urgency and energy affordability, solar remains one of the few solutions that is both scalable and attainable. The road ahead is not without obstacles, but the opportunity—for those willing to act—is still bright.

Sunistics’ moved to warehouse 3MW of pre-tariff solar panels and are using them on projects at pre-tariff prices. We expect to be able to use these on new projects until the end of Q3 before prices for new customers will increase in line with the tariffs, assuming they are still in place.