US tariffs to complicate renewable energy transition across Americas

The Donald Trump administration’s implementation of reciprocal tariffs is particularly evident in sectors deemed critical to national interests, such as energy, where maintaining stable supply chains is essential. As the US tariff landscape continues to evolve, the implications for energy markets across the Americas are profound. Designed to bolster domestic manufacturing and reduce reliance on imports, the tariffs have inadvertently led to significant disruptions in clean energy supply chains. As such, the tariffs are expected to complicate the renewable energy transition across the Americas, says GlobalData, the data and analytics company.

GlobalData’s latest report, North and South America Renewable Energy Policy Handbook 2025, shows the US tariffs have created ripples across the country and has affected trade dynamics within the American continent. Energy producers, suppliers, and consumers need to remain flexible in adapting to these changes, which requires a revaluation of supply chain strategies, contractual arrangements, and domestic production capabilities.

Sudeshna Sarmah, Power Analyst at GlobalData, comments: “The tariffs expansion has introduced punitive duties on a range of clean energy components, including solar modules, wind turbines, transformers, and battery-related parts. While the intention behind the tariffs is to stimulate domestic production, the reality is that the current manufacturing capacity in the US falls short of meeting the burgeoning demand for utility-scale developments. This mismatch has resulted in inflated prices and significant delays in project timelines.”

The tariffs have also strained regional trade relationships, particularly with Canadian and Mexican exporters. The imposition of stringent domestic content and origin requirements has led to punitive duties on cross-border transactions, complicating energy cooperation initiatives. This regulatory environment has resulted in logistical bottlenecks and increased compliance costs for companies operating across North America, further exacerbating the challenges faced by the clean energy sector.

Sarmah concludes: “The renewable energy sector in South America is particularly stressed by these tariffs. Shortages of critical components and heightened procurement risks have slowed grid modernisation efforts and increased uncertainty for utilities. As a result, long-term investments in clean energy projects have been inhibited, further complicating the region’s energy transition.”