nsucurrent.com May 20, 2018

Expert on solar energy says new tariff will bring mixed results

28 January 2018, 12:35 | Ruby West

SunCommon preps for solar-panel tax, says it harms everyone

Trump's Solar Tariff Triggers Concern From Texas Companies

There should be no cops on the trade beat, free traders say.

The tariff likely will help some domestic solar panel manufacturers, but it is certain to drive up prices and adversely affect the overall industry, costing rather than producing jobs.

United States manufacturer Solyndra, famous for going bust after being receiving large government loans, claimed to have been undercut by the flood of cheap panels from China. That's why they are demanding trade law enforcement.

What it will do, however, is put a crimp in one of the US economy's big success stories, the rapid growth of renewable energy.

The solar industry has many more jobs in the US installing solar panels than making them, and the tariffs endanger those jobs. Chinese president Xi Jinping's chief economic advisor, Liu He, said at Davos this week that his country stood against protectionism and for globalism.

In other words, a lot of bluster and fulminating and a few cases resulting in imposition of duties but no huge trade-war-triggering decisions and no significant movement on negotiating or renegotiating big trade deals. Imports comprise 80 percent of solar panels in the country. Industry groups are anxious this could slow the spread of renewable energy and force businesses to trim their workforces. Community solar projects do not usually require customers to own their homes, so renters can take part.

He estimated that the modules make up about 10 percent of the cost. Many media outlets, citing economists and solar industry representatives, reported such a move would destroy thousands of jobs in the US and dramatically reduce the number of solar photovoltaic installations. Canada and Mexico seem disinclined at the moment to rework NAFTA, nor does China feel the need to agree with whatever the United States asks for. Chinese manufacturers ducked the tariffs by moving production to Taiwan.

The two companies once employed some 3,200 Americans.

"If I was an American-made company, I would increase my price", Beck said. Foreign companies build cells and modules at a much lower cost, attracting American installation firms with the prospect of greater profits. And now, another has shut down and declared bankruptcy.

About 25 percent of total new power plant capacity installed in 2017 came from solar. The ITC recommended tariffs even higher than those that the president ultimately imposed this week. And they are not a niche product.

Twenty years ago, there were 23 aluminum smelters in the U.S. Now there are five.

Still, the USA was only the 14th-biggest seller to the world's largest importer past year and China has a slew of suppliers from Saudi Arabia to Angola and Russian Federation looking to sate its appetite.

Electronics giant LG says US retailers will be increasing the price of washing machines from 20 percent to 50.

On the positive side, the tariffs provide much-needed certainty in the solar and microgrid industry, said David Chiesa, ‎senior director, global business development for ‎S&C Electric. The European Union recently followed suit. If so, the administration could impose import quotas and tariffs. Both investigations were undertaken as part of Section 201 of the Trade Act of 1974. The 30 percent tariff, which declines by 5 percent per year over four years, offers an exemption for the first 2.5 GW of imports.

The Commerce Department finally delivered the steel report on January 11 and the aluminum report on January 19.

"China expresses strong dissatisfaction regarding this", Hejun said in a statement.

That time is now.

Some local industries wanted the protections.

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