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Trump’s Solar Tariff May Cost Up to 23,000 U.S. Jobs, But Boost Domestic Manufacturing

June 11, 2018, 8:39 PM UTC

Over $2.5 billion in large installation projects have been stalled or cancelled due to President Trump’s newly imposed tariffs on imported solar panels, according to Reuters.

Since 2010, the U.S. solar power sector had been growing rapidly, but then slowed 2017. Over those seven years, the solar workforce increased 168%, but now, with the tariffs, the industry may be at a standstill.

The 30% tariff on imported panels, which President Trump announced in January, will last four years and decrease 5% each year. While the tariff may encourage investment in solar manufacturing stateside, it will cost up to 23,000 workers their jobs, Abigail Ross Hopper, president of the Solar Energy Industries Association, told the New York Times.

“The tariffs have slowed down the growth of our industry,” she said, citing the higher cost of domestically produced solar panels. “And that means jobs are not being created.”

Solar developers said the levy would raise the cost of major solar installations by 10% at the outset. Developers that couldn’t afford the increased cost had to shut down development of their installations.

Because of the tariff, McCarthy Building Companies had to cut its planned workforce of 1,200 people over several projects this year to around 600, according to senior vice president of renewable energy Scott Canada.

The tariff is changing the math on which markets are feasible for solar projects. Last year, developers were looking to expand services in the Midwest, but the renewable energy incentives in blue states like Massachusetts make that a safer bet for development now.

Despite the tariff, some firms continue to move forward in the Midwest in the hopes of gaining a financial advantage in the area after the tariff is phased out. Others stockpiled foreign-made solar panels before the tariff was imposed so that they could continue their work without worrying about the levy, at least for a while.

The intention of the tariff was to boost the manufacturing sector in America, which it has, albeit modestly. So far, about 700 new jobs in Ohio and Florida have been created to increase panel construction. However, that number may be limited due to increased automation in manufacturing.