The Takeaway from the Suniva Solar Panel Tariff Hearing

Last week, two bitterly conflicted sides of the solar industry met in Washington to testify before a government panel concerning a proposed tariff on imported solar panels. The trade case, brought on by US panel manufacturer Suniva, is proposing charging a trade tariff on any panels not made in the US. Suniva filed the petition back in April after going bankrupt, arguing that cheap, imported Chinese-made solar panels undercut their prices and made it impossible to compete in the market.

The industry is pretty much split on this issue, depending on whether it is a US based manufacturer, or an installer. Installers, and large solar-promoting organizations like the SEIA (Solar Energy Industry Association) argue that the proposed tariffs will drive up the price of solar and as a result hurt the industry, which has finally gotten to a point where it doesn't rely heavily on government assistance. They argue that this will cause the industry to retract, leading to a ton of revenue loss and a result, massive job losses.

On the other end, the US based solar panel manufacturers contend that the oversupply of Chinese panels have not allowed them to capitalize on the solar industry boom of the last 5 years. They argue that this has lead to job losses, with SolarWorld citing the fact that they laid off 350 workers last month. The inability to compete on panel price with Chinese manufacturers is to blame, they say.

The hearing yesterday has been part of the International Trade Commission's process to determine whether imported panels have caused injury to domestic manufacturers. If they find there has been serious effects by the Sept. 22 deadline, the commission will recommend remedies to President Donald Trump by November 13. He can then choose whether he wants to take the commission's recommendation.

SunPower CEO Tom Werner was at the hearing and testified against the Tariff, citing that the low costs of solar have allowed it to get where it is now, and that issuing a tarriff could damage the close-to-flourishing industry:

"I can say without hesitation that customers are embracing solar power because of its cost effectiveness and long-term price certainty. A determination of injury in this case risks severely distorting the market and impairing customers’ ability to freely choose between competing energy options."

The bottom line is that the solar industry, although it took a few years of government subsidy and tax credits, is just now starting to gain it's financial footing to where it can compete with fossil fuels price wise. The reason it has been able to ween off government assistance is that the price of panels has gone down 60% in the last five years. If not for these low panel prices, solar installation companies would struggle to stay in business. While a tariff on Chinese panels may help US solar manufacturers, it could have potentially dire consequences for installers, which could lead to thousands of Americans losing jobs.

It is still uncertain whether injury to the industry will be found by the ITC, and even less certain if President Trump would impose a tariff on panels. Solar industry veterans worry that the "America First" agenda that the President pushed in his campaign would imply that Trump would likely support the tariff to support American based manufacturers. If the President pays attention to the numbers though, he will see that the amount of jobs that could be lost due to installers going out of business will greatly outnumber the amount of jobs held by the manufacturers'. At this point, it's too early to tell what will happen.