Trump’s new solar tariff to protect US manufacturers will hurt installers

In a move that may increase the cost of installing solar panels for American homeowners and utilities, the US Trade Representative issued new tariffs on imported solar panels. The ruling is based on recommendations from the US International Trade Commission and adds a 30 percent tariff on solar cells and modules.
It kicks in after the first 2.5 gigawatts’ worth of imported capacity and is slated to decline over the next four years.
Monday’s announcement also included tariffs of up to 50 percent for imported washing machines.
The ITC made its recommendations in December after solar manufacturers lobbied the commission on the case that China had been subsidizing its solar manufacturers unfairly since 2005, allowing it to undercut US manufacturers.
This was a big part of why Solyndra, a solar manufacturer that received a $535 million loan guarantee from the Obama administration, went bankrupt. In 2012, the federal government added anti-dumping duties to Chinese solar panels, but manufacturers exploited a loophole that allowed them to bypass the duties by moving final assembly to Taiwan.
When US solar manufacturers tried to get another set of tariffs installed in 2013, Chinese companies moved production to Germany, South Korea, Singapore, and Malaysia.
The side effect of this tariff whack-a-mole was that solar panel prices around the world cratered, leading to a blossoming of solar power. Solar is now the fastest-growing source of new energy, with 86 gigawatts expected to be installed this year worldwide.
However, the trade case exposes a rift in the US solar community between manufacturers and installers. Beleaguered US manufacturers like Solar World will benefit somewhat from the tariffs, but installers, who want the lowest-cost hardware, are likely to suffer.
The Solar Energy Industries Association, which represents solar installers like Elon Musk’s SolarCity, was aghast at the ruling, saying yesterday that it would harm the industry and cost thousands of jobs.