The International Trade Commission ruled Friday that imports of low-cost solar panels have hurt U.S. manufacturers. The decision gives the Trump Administration the power to issue steep tariffs on Chinese companies—where the majority are made—cutting off the flow of cheap panels to installers in the U.S.
The upshot? Solar panel costs could rise for homeowners and businesses, forcing installation companies to potentially cut jobs, industry groups and analysts argue.
In April, manufacturer Suniva petitioned the ITC—nine days after the company sought Chapter 11 bankruptcy protection—arguing that an influx of cheap panels made it impossible for them to compete. SolarWorld supported its petition. Suniva has requested that solar cells brought into the United States have a 40-cent tariff. The company wants solar panels to have a minimum price of 78 cents a watt, which is two-thirds more expensive than the cheapest panels on the market.
Suniva, which makes panels in Georgia and Michigan, is owned by Hong Kong-based Shunfeng International Clean Energy since 2015. SolarWorld is a German manufacturer that has a subsidiary based in Oregon.
Tesla, which owns SolarCity, said its project will continue regardless of the final outcome.
“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.”
The issue has split the solar industry. On one side are a few solar manufacturers like Suniva and SolarWorld that say low-cost imports have made it impossible to be profitable. On the other side is the U.S. solar installation industry, which has benefited from low-cost panels that have led to explosive growth in rooftop systems on homes and commercial buildings as well as massive solar farms.
This boom in installations and solar farm construction has helped create thousands of jobs. U.S. solar industry employed 260,077 workers last year, a nearly 25% increase in the number of solar jobs between 2015 and 2016—a jump largely driven by a massive increase in solar panel installations, according to a report released in February by the non-profit solar advocacy group The Solar Foundation.
But now, analysts and the Solar Energy Industries Association say tariffs threaten to gut the industry.
Suniva’s remedy proposal will double the price of solar, destroy two-thirds of demand, erode billions of dollars in investment and and unnecessarily force 88,000 Americans to lose their jobs in 2018, SEIA president and CEO Abigail Ross Hopper said in a statement citing analysts’ forecasts.
This could even impact U.S. taxpayers who help pay for tax credits used to encourage Americans to use more clean energy. This could mean U.S. taxpayers will pay as much as $1.23 billion more, according to Bloomberg New Energy Finance.