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Blog by Trevor Sutton, Swad Sathe & Evelyne Williams • August 19, 2026
This Energy Explained post represents the research and views of the author(s). It does not necessarily represent the views of the Center on Global Energy Policy. The piece may be subject to further revision. Contributions to SIPA for the benefit of CGEP are general use gifts, which gives the Center discretion in how it allocates these funds. More information is available here. Rare cases of sponsored projects are clearly indicated.
President Donald Trump issued a proclamation on August 6 imposing tariffs on polysilicon and solar products under Section 232 of the Trade Expansion Act of 1962, which authorizes trade measures to manage national security threats. The proclamation follows a Commerce Department investigation, initiated in July 2025, into the national security effects of imports of polysilicon and its derivatives. The full findings of that investigation are not yet public.
In this blog post, the authors answer questions about the new tariffs, which take effect December 4, 2026, and find they are likely to substantially reshape the cost structure of the US solar market, but their impacts on supply chains will depend on investment in domestic manufacturing capacity.
The proclamation applies to raw polysilicon—an ultra-pure form of silicon essential to the manufacturing of solar technologies and semiconductors—polysilicon ingots and wafers, solar cells, and solar modules. These goods represent progressive stages along the solar value chain.
The proclamation establishes product-specific minimum import prices (MIPs) on all covered goods and imposes an additional 15 percent ad valorem tariff (calculated based on a product’s value) on ingots, wafers, and solar cells and modules. The MIPs are to be realized through variable tariffs. Specifically, if the declared value of a good is less than the applicable MIP, a fee equivalent to the difference will be applied. The proclamation sets initial MIPs (see Table 1) but allows the secretary of commerce to adjust them to reflect market dynamics.
Table 1: Tariffs by product
Section 232 authorizes tariffs and other executive actions when the president determines that certain imports “threaten to impair” US national security. For the president to exercise this power, the secretary of commerce must first assess through an investigation whether such an import-related national security threat exists. The findings of that investigation are then transmitted to the president, who must decide on the appropriate response within 90 days.
Prior to the first Trump administration (between 1962 and 2017), US presidents used Section 232 to restrict imports on five occasions, all of which related to petroleum products. By contrast, Trump has imposed tariffs under Section 232 seven[1] times in the past 18 months on a diverse set of products (see Table 2). In two other actions relating to aviation and critical minerals, the president deferred tariffs in favor of negotiations with trading partners.
Table 2: Section 232 investigations initiated since 2025
The proclamation reproduces a policy rationale first used in connection with tariffs on steel in 2018 that global overproduction has increased import volumes to the point of undermining domestic manufacturing capacity. As with steel, China accounts for an overwhelming share of manufacturing capacity and actual production of polysilicon and solar products.
In other ways, the proclamation charts new ground. Specifically, it marks the first time Section 232 has been used to impose tariffs on clean energy technologies. Solar products have long been subject to a range of import restrictions under other trade authorities that deal with unfair trade practices, forced labor, and import floods, but no president before Trump has identified polysilicon and its derivatives as a national security concern justifying tariffs.
The proclamation also marks the first time a US administration has used a trade authority to set MIPs. Neither Section 232 nor any other law authorizing tariffs contains specific provisions relating to MIPs. MIPs are generally regarded as incompatible with multilateral trade rules.
The US solar industry is highly dependent on foreign goods. A 2022 Department of Energy analysis found that the United States imported the vast majority of installed solar modules and virtually all raw polysilicon, ingots, wafers, and cells. US manufacturing of solar modules has increased substantially since the Inflation Reduction Act (2022), but domestic output still falls far short of demand. Imports of the goods covered in the proclamation exceeded $10 billion in 2025, mostly from Asia.[2] Although China accounts for a tiny share of these imports because of tariffs and other market barriers, most of the solar products exported to the US contain Chinese-made materials and components.
Price is the primary driver of this import dependence. Even with public support, domestic solar manufacturers have substantially higher costs of production than foreign competitors. The tariffs and MIPs are designed to close this cost gap. The MIPs for raw polysilicon, solar cells, and solar modules are set far higher than average global or regional prices for the covered goods, as reported by the International Renewable Energy Agency (IRENA) (see Table 3).
Table 3: Comparison of average global prices and Section 232 MIPs
Note: IRENA provides average global prices for raw polysilicon and solar cells and average prices in the European market for solar modules. The MIP for solar wafers does not lend itself to the same kind of comparison because it is determined on a per-kilogram basis while global spot prices are calculated on a per-unit basis. The unit weight of solar wafers varies by product type.
Source: For average global price: IRENA, Renewable Power Generation Costs in 2025.
These market barriers will strengthen the competitive position of US producers of the goods covered by the proclamation. Although they will increase upstream costs for some manufacturers, the price spread with imported modules is still likely to narrow. Whether the tariffs and MIPs will also meaningfully restructure US supply chains will depend on the willingness of investors to fund build-out of domestic manufacturing capacity. Without such build-out, the primary impact of the proclamation will be cost increases for solar operators rather than import substitution.
Yes, in a narrow sense. The proclamation reflects two policy preferences within the Trump administration that operate in tension with one another when applied to clean energy technologies. On one hand, the administration has strongly favored fossil fuels over renewable energy sources, for example, in its aggressive push for curtailment of the IRA’s clean energy manufacturing subsidies. On the other hand, Trump has made reduction of trade deficits and revitalization of US industry a centerpiece of both his domestic and foreign policy agendas.
The proclamation downplays this tension by emphasizing the importance of solar-grade polysilicon to national defense programs, artificial intelligence, and the semiconductor industry. The proclamation does not contain any reference to energy—a conspicuous omission given that the vast majority of polysilicon is made into solar products used for civilian energy purposes.
Yes. The MIPs parallel an initiative the White House announced in February to establish plurilateral price floors for critical minerals through “adjustable” tariffs. On the US side, the most obvious pathway to such price floors would be further presidential action under the Section 232 critical minerals investigation completed last year, building off negotiations ordered by Trump under the statute in January. The mechanism established in the proclamation offers a template for such action.
The proclamation also constitutes the clearest signal to date that the White House views China’s dominance of clean energy supply chains as a national security concern, even in sectors where US-China bilateral trade is not significant. This concern is likely to inform the review of the US-Mexico-Canada Agreement that kicked off in July as well. US Trade Representative Jamieson Greer has stated that the United States will seek stricter rules of origin under the agreement to reduce incentives for North American producers to source inputs from Chinese firms.
[1] The figure is higher if proclamations adjusting previously imposed tariffs under Section 232 are included, for example, tariffs on steel and aluminum products first imposed in 2018.
[2] Source: US customs data on imports of articles classified under HS Codes 2804.61, 3818.00, 8541.42, and 8541.43 in 2025. Accessed through the USA Trade Online portal: https://usatradeonline.census.gov/home.
Senior Research Scholar
Research Associate
Trade Policy
Research Associate
Energy Policy Trade Policy
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