Panel rules cheap solar imports hurt U.S. firms, sends tariff decision to Trump
The four-person commission agreed that solar imports are hurting American manufacturers, though they were divided on the impact of Canadian solar cells. If the White House imposes tariffs, solar costs in the U.S. could double
WASHINGTON—Low-cost solar panels imported from China and other countries have caused serious injury to American manufacturers, a U.S. trade commission ruled late last week, raising the possibility of the Trump administration imposing tariffs that could double the price of solar panels from abroad.
The 4-0 vote by the International Trade Commission sets up a two-month review period in which the panel must recommend a remedy to President Donald Trump, with a final decision on tariffs expected in January.
Though the investigation found overall damage to U.S. solar firms, the commission was divided on the impact of Canadian imports. Three of the four panel members made negative findings for Canadian crystalline silicon photovoltaic imports, while one found Canadian shipments accounted for “a substantial share of total imports and contribute importantly to the serious injury caused by imports.”
White House spokeswoman Natalie Strom said Trump “will examine the facts and make a determination that reflects the best interests of the United States. The U.S. solar manufacturing sector contributes to our energy security and economic prosperity.”
Georgia-based Suniva Inc. and Oregon-based SolarWorld Americas brought the case, saying a flood of imports have pushed them to the brink of extinction. Suniva declared bankruptcy, while SolarWorld had to lay off three-quarters of its workforce.
Cheap imports have led to a boom in the U.S. solar industry, where rooftop and other installations have surged tenfold since 2011.
The main trade group for the solar industry and many governors oppose tariffs, saying they could cause a sharp price hike that would lead to a drop in solar installations by more than 50 per cent in two years.
Abigail Ross Hopper, president and CEO of the Solar Energy Industries Association, called the trade commission’s vote disappointing for nearly 9,000 U.S. solar companies and the 260,000 Americans they employ.
“Foreign-owned companies that brought business failures on themselves are attempting to exploit American trade laws to gain a bailout for their bad investments,” Hopper said, warning that potential tariffs could double the price of solar installations, lowering U.S. demand and risking billions of dollars in investment.
Suniva’s U.S. operations are based in Georgia, but the company’s majority owner is in China. SolarWorld Americas is a subsidiary of German solar giant SolarWorld, which declared insolvency last month.
Suniva hailed the ruling.
“It will be in President Trump’s hands to decide whether America will continue to have the capability to manufacture this energy source,” the company said in a statement. “President Trump can remedy this injury with relief that ensures U.S. energy dominance that includes a healthy U.S. solar ecosystem and prevents China and its proxies from owning the sun.”
Trump has not cozied up to the solar industry, as he has for coal and other fossil fuels, but he is considered sympathetic to imposing tariffs on solar imports as part of his “America first” agenda.
Governors of four solar-friendly states—Nevada, Colorado, Massachusetts and North Carolina—oppose the tariff, warning it could jeopardize the industry. They cited a study showing that a global tariff could cause solar installations to drop by more than 50 per cent in two years, a crushing blow as states push for renewable energy that does not contribute to climate change.
“The requested tariff could inflict a devastating blow on our states’ solar industries and lead to unprecedented job loss, at steep cost to our states’ economies,” the two Republicans and two Democrats wrote in a letter Thursday to the trade commission.
A group of former U.S. military officials also urged the Trump administration to reject solar tariffs, noting that the Defence Department is the nation’s largest energy consumer and follows a federal law calling for the Pentagon to procure 25 per cent of its energy from renewable sources by 2025.
Suniva called the case a matter of fairness. Even with better manufacturing methods, lower costs and “dramatically improved efficiency,” the company has “suffered substantial losses due to global imports,” Suniva said in its petition. The company declared bankruptcy this spring after laying off 190 employees and closing production sites in Georgia and Michigan.
SolarWorld Americas, meanwhile, has trimmed its workforce from 1,300 to 300, with more cuts likely.
“After nearly 30 factories have shut down in the wake of surging imports, the legacy of this pioneering American industry hangs in the balance,” said Juergen Stein, CEO and president of SolarWorld Americas.
“We believe that the promise of solar—energy sustainability and independence—can be realized only with healthy American manufacturing to supply growing U.S. demand,” Stein said in a statement to The Associated Press.
Hopper countered that a tariff would likely decrease the number of U.S. manufacturers, because of reduced demand.
While the U.S. solar industry employs about 260,000 people, fewer than 2,000 are involved in making solar panels like those made by Suniva and SolarWorld. More than half of solar jobs are in installation, with another 66,000 in sales, distribution and development.
About 38,000 jobs involve manufacture of inverters, racks and other products related to solar panels.
Hopper told reporters she was optimistic that Trump would not impose tariffs on solar imports.
“The president wants to create jobs and increase energy security and economic prosperity, and that is the story of the solar industry,” she said. “I think that is entirely resonant with his rhetoric and his concern.”
—With a file from Cleantech Canada Staff