Why US, EU curbs on Chinese power inverters risk upending green supply chains
As Western governments move to end dependence on world’s top producer, analysts warn rapid decoupling could drive up costs and derail projects
A United States ban on new foreign-made power inverters has aligned Washington with Brussels in attempting to push Chinese suppliers off Western grids, a shift analysts caution will be neither quick nor painless as a supply squeeze looms in a market China dominates.
The administration of US President Donald Trump last week announced restrictions on new foreign-produced connected power inverters, citing national security concerns.
While the measure did not explicitly name China, suppliers in the world’s second-largest economy are expected to be among those most affected, given they accounted for about one-third of American inverter imports in 2024.
Dutch bank ING warned in a Friday report that simultaneous restrictions by the US and EU could raise costs and deepen supply-chain pressures on the American clean energy sector in the medium term, as competition for compliant inverters grows amid tighter European regulations.
Once viewed as simple power conversion devices, inverters have evolved into connected systems capable of remote monitoring and control, making them an increasingly important part of modern electricity networks, according to the US National Renewable Energy Laboratory.