Prospect of Trump tariff casts pall over US solar industry
LOS ANGELES: US solar companies are snapping up cheap imported solar panels ahead of a trade decision by the Trump administration that could drive up costs and cloud the fortunes of one of the economy’s brightest stars.
Domestic consumers and businesses have been embracing solar energy at a furious pace – thanks to a big assist from China. Low-cost photovoltaic cells and panels made in China and other Asian countries have helped drive down costs by around 70 per cent since 2010, enabling more Americans to go solar.
Installations in the United States last year hit a record. Jobs are mushrooming too.
The domestic industry now employs more than 260,000 people, according to The Solar Foundation, most of them construction workers hammering panels on rooftops and erecting utility-scale solar plants in the nation’s blistering deserts.
But signs of a chill are already visible as the industry waits to see how President Donald Trump responds to a recent trade complaint lodged by a Georgia manufacturer named Suniva.
The company has asked the administration effectively to double the price of imported solar panels so that US factories can compete.
About 95 per cent of cells and panels sold in the US last year were made abroad, with most coming from China, Malaysia and the Philippines, according to SPV Market Research.
Trump has wide latitude to levy tariffs to protect domestic firms. His actions could determine whether sun-powered electricity can compete with fossil fuels to light the nation’s homes and businesses.
The White House would not comment on the solar trade case. But the administration has vowed to protect steelmakers and other US manufacturers by penalizing ‘unfair’ imports.
That has the solar industry bracing for the worst. Panic buying has sent spot prices for solar panels up as much as 20 per cent in recent weeks as installers rush to lock up supplies ahead of potential tariffs.
Skittish US energy customers are putting some solar projects on hold. Manufacturers are eyeing other markets to develop.
And some investors are running for cover. Funding for large US solar deals fell to US$1.4 billion in the second quarter, down from US$3.2 billion in the first quarter and US$1.7 billion a year earlier, primarily due to concerns about the trade case, according to research firm Mercom Capital Group.
Developers of solar farms that provide utilities and big companies with energy are particularly vulnerable; panels account for as much as half of the cost of their projects. — Reuters