Donald Trump’s latest tariffs have sent fresh shockwaves through the global clean energy sector.
In early 2025, the United States imposed sweeping new anti-dumping and countervailing duties (AD/CVD) on Chinese clean-tech exports, reaching up to 175% on Chinese solar panels and 195% for polysilicon, wafers, and cells which are poised to escalate costs across the clean energy supply chain.
These measures are distinct from the broader reciprocal tariff framework agreed under the US–China trade truce in June 2025, under which US will apply a unified 55% tariff on Chinese imports.
This escalation revives trade tensions and raises sharp questions about how industrial policy collides with climate action.
The move, framed as a way to protect US jobs, counter China’s dominance, and generate tax revenue, may have far-reaching consequences at a time when the world can least afford clean energy delays.
The impact is already visible in Southeast Asia, where Chinese exports are flooding markets and countries like Thailand face mounting pressure to adapt.
Risks: Slowing Down the Green Transition
The immediate concern is that the tariffs could choke clean energy growth just as global momentum is accelerating.
In the US and Europe, where Chinese-made clean-tech components dominate—accounting for over 80% of global solar panel production and around 65% of wind turbine installations—the new duties are already driving up costs for renewable projects, threatening delays and complicating efforts to cut emissions.
Climate experts also warn that US-led protectionist tariffs risk fracturing the global cooperation needed to scale up clean energy. “An increase in trade protectionism is not good for climate action,” says Dr. Simi Thambi, a climate economist at Farm Animal Investment Risk and Return (FAIRR).
She points to the Intergovernmental Panel on Climate Change (IPCC)’s SSP3 scenario, which shows a world splintered by rivalry and weak collaboration, where emissions could surge up to four times higher than in a sustainability-focused pathway, blowing past the Paris Agreement’s 1.5°C target by 2100.
With net-zero pledges depending on smooth, affordable access to global clean-tech supply chains, any disruption now could derail progress at a time when every year counts.
Opportunities: Catalyzing Domestic Green Industry
While the risks are clear, some view the tariffs as a long-overdue catalyst for change.
By shaking confidence in Chinese supply chains, the new tariffs could push countries to ramp up local green manufacturing and shore up energy security.
Diversifying away from China, still the world’s dominant supplier of solar panels, batteries, and critical components, has been debated for years, but the tariffs may finally force action.
For governments looking to build more resilient clean-tech industries, the disruption offers a chance to invest in domestic capacity, create jobs, and reduce exposure to geopolitical shocks.
However, Leslie Abrahams, deputy director at the Center for Strategic and International Studies (CSIS), cautions that the newly imposed tariffs may hinder the rollout of clean energy in the US and risk pushing the country to the margins of the global market.
“The newly proposed tariffs will make it more expensive to deploy clean energy technologies and reshore manufacturing to make them here,” she warns,
Because the tariffs also apply to essential inputs such as cement, construction equipment, and electronic components, the cost of building and outfitting new factories is expected to rise significantly.
This could lead to delays in clean power development and undercut US competitiveness in the fast-moving global green energy race.
The ASEAN Dimension: China+1, Cheap Supply, Tough Choices
As the new tariffs hinder China’s clean-tech exports, ASEAN has become a major outlet for redirected solar panels, batteries, and components.
But the region’s role is complex. Recent US tariffs have identified several ASEAN countries as potential conduits for Chinese goods aiming to bypass trade restrictions.
Starting from August 1, 2025, Cambodia and Thailand will face a 36% reciprocal tariff, while Vietnam will be hit with a lower 20% rate, although still maintaining a 40% levy on goods deemed to be transhipped from third countries via Vietnam.
In addition to the reciprocal tariffs, Cambodia, Laos, Myanmar, and Vietnam have been flagged for their roles in this transshipment strategy. This results in AD/CVD on solar products from Cambodia faces tariffs as high as 3,521%, while Vietnam’s tariffs reach up to 395.9%, Thailand’s up to 375.2%.
These measures reflect concerns over the “China+1” manufacturing model, where Chinese firms shift production to neighbouring countries to mitigate tariff impacts. As a result, these nations are under scrutiny, and their roles in global supply chains are being reevaluated.
As the tariffs squeeze China’s access to traditional markets, Chinese manufacturers have ramped up exports to ASEAN countries, flooding the region with cheap solar panels, batteries, and other components.
While this influx of low-cost goods has lowered upfront costs for local developers, it has also displaced domestic production and hampered ASEAN’s own industries.
Experts warn that the long-term risks—including market distortions, weakened local manufacturing, and stunted growth in clean energy capacity—could undermine the region’s push for a resilient and self-sufficient energy transition.
Thailand’s Double-Edged Exposure
As part of ASEAN, Thailand is deeply entangled in the region’s shifting clean-tech landscape—both benefiting from and vulnerable to the surge of Chinese imports.
Thailand is a major consumer of clean technology, with its clean energy blueprint, as outlined in Power Development Plan 2024 (PDP2024), potentially heavily reliant on Chinese solar panels, EV batteries, and critical components.
While these low-cost imports offer short-term advantages, Thailand must tread carefully. The experience of Pakistan, where Chinese-backed power projects have saddled the country with unsustainable debt and high electricity costs, is a cautionary tale.
Despite massive investment, Pakistan is now paying for electricity it doesn’t use and struggling to repay loans, raising alarms about long-term dependency and lack of financial resilience.
Thailand would do well to avoid a similar trap by ensuring that short-term savings don’t come at the expense of long-term economic security and control over its clean energy future.
Strategically, Thailand must now find a way out of the China+1 trap that has already triggered steep tariffs and penalties across ASEAN
The current disruption could present an opening. Rather than remaining a low-cost assembler for foreign firms, Thailand now has an opportunity to move up the value chain.
“Thailand has more than six million tonnes of solar-grade quartz reserves that could be used to produce polysilicon—the key ingredient to produce solar wafers,” said Phipatana-Phuttapanta, the government’s solar expert.
Although she noted that developing these resources would require “technical expertise and high investment,” the potential is significant.
By investing in upstream production—such as polysilicon processing—and prioritising high-value manufacturing, R&D, and quality assurance, Thailand could reduce its reliance on volatile export markets and position itself as a more resilient, self-sustaining clean energy hub.
Thailand’s clean energy future will depend not just on how fast it can scale up—but on how wisely it navigates the complex crosscurrents of global trade, industrial policy, and quality control.
