Solar news may soon report massive declines in solar installation jobs across the country if the Trump Administration has its way. While tariffs imposed on foreign imports are usually reported in the financial news, the steep financial levies on Chinese solar panels may soon cause headlines in solar news reporting as well.
For further details on this ongoing issue, be sure to keep an eye out for steep price surges in residential and commercial solar panels and installations if the Trump Administration imposes the proposed tariffs on Chinese solar panel companies. The new tariffs will cut off the supply of inexpensive solar panels that have paved the way for a huge percentage of rooftop installs in recent years. If the tariffs are imposed, look for a steep rise in solar panel costs for homes and businesses that will lead to layoffs and job losses; industry wide.
In Oregon, clean energy advocates predict with trepidation that these proposed tariffs will hurt domestic sales and installations of solar panels on a nationwide basis. The so called problem began when the U.S. International Trade Commission (ITC) ruled that foreign-made, inexpensive solar panels are hurting US manufacturers. Their solutions include the proposed tariffs. The co-founder of Obsidian Renewables, David Brown feels strongly about the consequences that these tariffs bring to Oregon as far as clean energy jobs are concerned. “It will cost lots of jobs – not forever, because it’s so stupid, it’ll get repealed,” he states. “But for as long as it’s in effect, it’ll be a disaster.”
This begs the question; will tariffs improve domestic solar manufacturing over the long term and should we impose price bottoms and higher prices to keep foreign products out of the country in the mean time? What about the thousands of jobs lost in both domestic solar farms construction and installations? In Oregon, renewable energy jobs increased by a striking 40% margin between 2015 and 2016. This is according to the Solar Foundation. While nationwide, more than 260,000 people are employed by the solar industry but it is estimated that the proposed tariffs could trim that figure by 88,000 jobs. According to Brown, the International Trade Commission‘s decision is already causing chaos in the domestic solar market. He points out that solar installation jobs are more numerous here in the U.S. than actual panel manufacturing careers. Most jobs lost due to imposed tariffs will be from the installation sector.
Not everyone shares the views that tariffs would be detrimental to the domestic renewable energy industry. In April of this year, clean energy manufacturer Suniva petitioned the ITC stating that large influx of cheap solar panels to the States made it virtually impossible to compete. They made this statement a mere nine days after Suniva sought Chapter 11 bankruptcy protection. Their petition was supported by another prominent solar manufacturer; SolarWorld. According to Suniva, any solar cells brought into the country should have a 40-cent tariff. In addition, Suniva wants panels to have a minimum price of 78 cents a watt, which is two-thirds more expensive than the least expensive panels currently on the market.
Renewable energy giant Tesla is “currently building the largest solar cell and module plant in the U.S., and we are committed to expanding our domestic manufacturing with or without any tariff or price guarantees, a Tesla spokewoman said.”
This controversal tariff issue is splitting the industry down the middle. On one side are Suniva and Solar World which claim that low cost foreign imports of solar cells have made it difficult to be profitable. Opposing them on the other side is the U.S. solar installation industry which has greatly benefitted from having lower cost installation panels to install on both residential and commercial rooftops as well as for huge solar farms.
The influx of cheap solar technology has led to a boom in installations and solar farm construction. This in turn has created the need for thousands of jobs; mainly in the solar installations sector.
According to The Solar Foundation, the U.S. solar industry employed 260,077 workers last year which translates into a nearly 25% increase in the number of renewable energy jobs between 2015 and 2016. This huge jump in clean energy jobs was largely driven by a huge increase in solar panel imports. The Solar Foundation is a nonprofit advocacy group that according to its website “The Solar Foundation is a nonprofit, nonpartisan organization dedicated to advancing the use of solar and solar compatible-technologies worldwide.”
Are the good times over for cheap solar panel installations? Maybe for now; if the tariffs are imposed; at least that’s what the Solar Energy Industries Association says. SEIA president and CEO Abigail Ross Hopper said in a statement citing analysts’ forecasts that “Suniva’s remedy proposal will double the price of solar, destroy two-thirds of demand, erode billions of dollars in investment and unnecessarily force 88,000 Americans to lose their jobs in 2018.”
Actions like these could even impact domestic taxpayers who help pay for tax credits used to encourage Americans to use more solar power and other forms of clean energy. This could mean U.S. taxpayers will pay as much as $1.23 billion more, according to Bloomberg New Energy Finance.
There are pros and cons to both views. The imposed tariffs would greatly assist the small number of domestic solar manufacturers that remain in existence but overall it could send costs for solar panels and installations through the roof which in turn would hurt the much larger renewable energy installation industry on a national level. A chain reaction of this type could put a fast end to the U.S. clean energy boom, which witnessed solar technology become the country’s biggest source of new power generation last year for the first time in history.
The future of domestic solar manufacturing is unclear. Federal subsidies have helped to slash costs at a faster rate than predicted but these subsidies are being fully phased out and will be finished by the year 2020. In the meantime, cell production has shifted to countries like Vietnam, Malaysia and South Korea. Events in the near future should be interesting as the ITC is scheduled to send its recommendations for trade remedies to President Trump by Nov. 13, 2017. Regardless of any recommendations, the President can choose and implement any trade barrier he selects. Needless to say, this has both installers and project developers in a sheer panic, and many of these are known to be stockpiling panels ahead of any possible tariffs. As stated earlier, the SEIA is forecasting huge job losses of up to a third of the U.S. solar energy sector. It’s unlikely that solar production will be able to match even the reduced demand for renewable energy products and cells over the coming 2018 year. This issue involving tariffs gives Trump the opportunity to implement the trade barriers he has long claimed as a central component of his goal of bolstering manufacturing at the domestic level. This strategy has a dual purpose as Trump also can take aim at the Chinese clean energy firms that have previously circumvented U.S. import penalties to ultimately morph into becoming the world’s top suppliers of solar panels and cells.
While it’s not common to see solar news mixed with conservative politics, it’s wise to keep an eye peeled for what Trump and his fossil fuel allies do in the coming months. They could deal the renewable energy industry a hard blow under the guise of promoting domestic manufacturing. Solar news sources will be reporting the outcome of these pivotal dealings from the Oval Office as early as the coming weeks.