Claims that President Donald Trump imposed 30 percent tariffs circulated in January 2018.
President Trump signed a proclamation imposing tariffs on solar panels and other solar equipment on January 23, 2018. The president said the tariffs would kickstart American solar manufacturing, but industry groups have argued the move will hurt both solar power and jobs.
First, we’ll take a look at what, exactly, the proclamation does. It establishes tariffs on solar panels over a four-year period, beginning at 30 percent in the first year and dropping to 15 percent by the fourth. The proclamation also imposes tariffs on washing machine imports (again, the stated purpose is to boost American manufacturing). In a White House signing ceremony, Trump explained:
It’s a very big industry, and you’re going to have a lot of plants built in the United States that were thinking of coming, but they would’ve never come unless we did this. Big industry. A lot bigger than people would understand.
And this is similar, but this is for solar products so that we’ll be making solar products now much more so in the United States. Our companies have been decimated, and those companies are going to be coming back strong.
So this is panels and products — generally, solar. Potentially great industry in this country, but now we’ll be making it in the United States. Okay. A lot of workers; a lot of jobs.
There’s little agreement, however, about the true impact Trump’s tariff’s on solar panels will have. Industry groups have argued that it will actually lead to fewer manufacturing jobs in the U.S. And energy analysts have warned that the tariffs will lead to higher overall energy prices. We’ll take a look at both sides of the argument.
Solar industry growth has been a boon for American workers in recent years. By 2016, 260,077 jobs were supported by solar industry — a 25 percent from the previous year. And the Solar Foundation anticipated a 10 percent increase in solar sector jobs in the year ahead.
So, why jumpstart the already booming solar industry? The simple answer is that Suniva, a U.S.-based solar panel and cell manufacturer asked for it. The company filed a petition under Section 201 of the Fair Trade Act of 1974 seeking “global safeguard relief” from imports of crystalline silicon photovoltaic (CSPV) cells and modules in the form of trade protections.
The U.S. International Trade Commission (ITC) reviewed the petition and sided with Suniva in October 2017. In a report passed onto the president, ITC recommended that a 35 percent tariff be imposed on solar panel and product imports. In it, ITC Commissioner Meredith Broadbent explained that it was ITC’s view that “subsidization of manufacturers in China” was the underlying cause of solar imports, which has led to damaging over-supply:
Over the five year period covered by this safeguard investigation, U.S. producers of CSPV products have suffered operating losses as a result of low market prices that have prevented the expansion of production capacity necessary to compete successfully with imports. Many U.S. producers have shut down facilities. My recommendations are intended to address the serious injury while seeking to avoid inflicting additional damage on the broader solar energy industry in the United States. The U.S. solar energy industry has been a relative success story in making progress toward grid parity with a carbon neutral source of power. The United States is recognized as a global leader in this broader sector and U.S. taxpayers and policy makers have chosen to support this success over many years.
Trump wasn’t bound by ITC’s recommendation, and he ultimately decided to impose a tariff of 30 percent — not the recommended 35 percent. Still, solar industry groups have cautioned that the tariffs will have a negative impact on the industry and cause job losses. the Solar Energies Industries Association (SEIA) predicts 23,000 lost jobs in America by the end of 2018 alone:
“There’s no doubt this decision will hurt U.S. manufacturing, not help it,” said Bill Vietas, president of RBI Solar in Cincinnati. “The U.S. solar manufacturing sector has been growing as our industry has surged over the past five years. Government tariffs will increase the cost of solar and depress demand, which will reduce the orders we’re getting and cost manufacturing workers their jobs.”
The true impact of Trump’s 30 percent tariff on solar panels and products remains to be seen.
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