Utility Dive•about 1 month ago
Tariffs push construction input prices higher
Key Takeaway
Rising tariffs on critical electrical components are significantly increasing construction costs for power projects, directly impacting project economics and PPA pricing for developers and large power consumers.
AI Summary
- •Construction input costs for critical electrical components are rising significantly, with switchgear, switchboard, and industrial controls equipment up 11.1% year-over-year, and copper wire and cable up 11.7%.
- •These increases will directly elevate the capital expenditure (CapEx) for new power generation, transmission infrastructure, and large load interconnection projects.
- •The article attributes these rising costs to 'tariffs,' indicating policy-driven cost pressures on imported materials and components.
- •Developers of renewable projects (solar, wind, storage) and large power consumers (like datacenters) building out their infrastructure will face higher material costs, impacting project viability and PPA pricing.
Topics
datacenterfinancingoempolicyppasolarstoragetransmissionwind
Article Content
The latest PPI report presents “plenty of cause for concern,” according to Associated Builders and Contractors. Switchgear, switchboard and industrial controls equipment was up 11.1% from last year; copper wire and cable were up 11.7% and unprocessed energy materials were down 4.9%.