Trump tariffs could dim prospects for green energy

Tax on solar panels a blow to industry and homeowners

The Trump administration on Monday announced it would slap costly tariffs on imported solar technology, drawing ire from Bay Area solar companies who rely on the parts for solar panels, and frustration from homeowners who worry the costs of converting to green energy will spiral.

Administration officials framed the 30 percent tariffs as a way to protect domestic manufacturers and take a more aggressive stance toward China, which produces a number of the photovoltaic cells and modules that go into solar panels.

But environmentalists and solar supporters saw the move as Trump’s latest attack on renewable energy and California, which leads the country in green energy jobs, and another in a series of actions to erode environmental regulations introduced under President Obama.

“This is a political decision for the president and I think it’s unfortunate because people on the left and right embrace solar energy,” said

Bernadette Del Chiaro, executive director of the California Solar Energy Industries Association.

Local solar businesses, state officials and industry groups say U.S. manufacturers can’t keep pace with production in China and fear the move could slow the adoption of renewable energy, raise the price of solar panels and cost the region jobs.

“I think it’s a self-inflicted wound,” said David Hochschild, one of five members of the California Energy Commission, the state agency that focuses on energy policy. “Any policies that arbitrarily raise the price of clean, domestic sources of energy like solar are a mistake, and I think the evidence is very strong that when you do that kind of thing, it results in a net reduction in total solar industry jobs.”

‘Big impact’

Right now, about 80 percent of solar panel products come from abroad. The Solar Energy Industries Association estimates the tariffs will eliminate some 23,000 jobs this year. Many of those could be in California, which is home to around 100,000 of the country’s 260,000 solar energy jobs, Hochschild said. The solar industry provides more than 2,000 jobs in Alameda, San Francisco, San Mateo and Santa Clara counties alone.

“There will be a big impact for us here,” Hochschild said, adding that manufacturing makes up just 10-15 percent of solar industry jobs, while most of the jobs are in support and maintenance and sales, which could be adversely affected

by the tariff.

Michael Maulick, president and CEO of SunLink, a Mill Valley-based solar company, said in a statement the tariff would harm the industry and stifle innovation.

“Artificial price hikes through tariffs only work to impede economic progress when the solar industry has worked for years to make solar affordable through innovation, a global supply chain, production scale growth and private investments,” Maulick said.

Those price hikes might not hit consumers immediately, though. Some of the leading solar companies saw the tariff coming, Hochschild said, and stocked up on panels ahead of time.

Del Chiaro said local governments could help mitigate the effects of the tariff by relaxing other costs for things like building permits. But Hochschild pointed out that a number of incentives for going solar have expired and said softening the blow will not be easy.

It’s unclear just how much of the cost will be passed on to consumers or where jobs will be lost.

Some companies say they’ll fight back, pushing for certain exemptions for innovations and other unique products.

“We were disappointed that today’s announcement didn’t address product exemptions, which SunPower has requested,” the San Jose-based company’s CEO Tom Werner said in a statement.

While most of the solar industry voiced its opposition, the tariffs were requested by two solar manufacturers — bankrupt solar company Suniva and the U.S. subsidiary of Germany’s SolarWorld — which argued the increase in imported panels in the last half decade sent prices plummeting and harmed business. And Trump supporters celebrated the move as another indication of Trump’s commitment to bringing manufacturing jobs back home.

“The president’s action makes clear again that the Trump administration will always defend American workers, farmers, ranchers, and businesses in this regard,” U.S. Trade Representative Robert Lighthizer said in a statement announcing the decision.

The announcement comes as solar panel parts made overseas have gotten cheaper and made the solar industry more competitive with the coal and natural gas industries.

Environmentalist ire

But environmentalists blasted the decision as short-sighted, pointing to Trump’s efforts to prop up a waning coal industry and retreat from the Paris agreement on climate change.

The president has long raised alarm among the scientific community for his past comments questioning the evidence of climate change.

In 2012, Trump tweeted: “The concept of global warming was created by and for the Chinese in order to make U.S. manufacturing non-competitive.”

The tariff drops to 25 percent after a year, followed by 20 percent and 15 percent each year after, before going away completely. The first 2.5 gigawatts of imports each year will be exempt. The administration is also imposing a tariff on large residential washing machines.

But, Hochschild said, “virtually every solar company will be impacted by this.”