Did Trump Screw Over Booming U.S. Solar Industry?
Trump’s 30% tariffs on solar panels will cost 23,000 jobs and curtail growth in industry, says Dan Whitten of the Solar Energy Industries Association
D. LASCARIS: This is Dimitri Lascaris reporting for the Real News from Montreal, Canada. Last week, U.S. President Donald Trump signed an executive order imposing a steep 30% tariff on imported solar cells and panels, saying the move showed the United States would create more jobs in the country. Will the tariff on the solar cells, which come largely from China, have the opposite effect of what Trump claims? Will it cause job losses in the rapidly growing renewable energy sector in the U.S., and will it actually be all that it’s foretold to be?
With us to discuss these issues, I’m pleased to be joined by Dan Whitten. Dan is the vice president of communications with the Solar Energy Industries Association. That’s the national trade association for the U.S. solar industry. He joins us from Bethesda, Maryland. Thanks very much for joining us today, Dan.
DAN WHITTEN: Hi, Dimitri. How are you doing?
D. LASCARIS: Good, thank you. So Dan, what is your estimation about how this tariff is going to impact the industry in the United States, and what type of an impact do you anticipate this is going to have?
DAN WHITTEN: Well essentially what you have is a 30% tax on solar panels, and so that’s gonna increase the price of those panels by 30%. Obviously whenever you increase the price of something by that much, it’s gonna change the demand forecasts, and so, what we see is a drop in demand from what we would have had, which was astronomical growth. With that lost demand, you’re going to see about 23,000 lost jobs in the United States, net. I know the president is saying it’s intended to create jobs. Unfortunately, that’s not what’s gonna happen in this case.
D. LASCARIS: Let’s just unpack that a little bit, why you anticipate that that’s going to be the impact, because in theory at least, the Trump administration is saying that this is going to make the domestic production of solar panels more competitive, and I suppose his position would be that, to the extent solar panels are being produced domestically, there’ll be increased demand for them and that will result in more jobs. How do you respond to that reasoning?
DAN WHITTEN: Well, the increased demand is in solar institutions. The reason why you buy panels is because you have demand for that energy, and so what we’ve seen over the last 10 years is an average of 68% growth in solar installations, and that has created demand for more panels. The panels, whether they’re made overseas or in the U.S., is not a labor-intensive prospect anymore. They have figured out how to make panels in an automated way with very few workers at that site, so the jobs that you lose are installation jobs or engineers or electricians, and the jobs that you gain are a small amount of people who are making sure that the automated equipment is working right. We’re all for manufacturing in the United States. We support it, but it’s not a job creator and it’s not a demand creator.
D. LASCARIS: Perhaps I’m asking you to speculate a little bit here. We all know about President Trump’s affection for the fossil fuels industry. Do you think that this tariff, whether wittingly or unwittingly, is going to end up benefiting the fossil fuels industry by making fossil fuels’ energy generation more attractive vis a vis solar energy?
DAN WHITTEN: You know, it’s really hard to say. Obviously we compete aggressively with natural gas and wind. I think coal and nuclear are having a lot more trouble getting a foothold. The extent to which it changes the dynamic toward fossil fuels is really hard to estimate right now, but it certainly will nudge things away from solar, which is not a positive for anybody.
D. LASCARIS: And is it the view of your association or the industry that the imposition of this tariff is potentially violating World Trade Organization rules or other applicable trade agreements?
DAN WHITTEN: The World Trade Organization, the way that’s set up is that the only organization that can contest a tariff is a country, so it’s a country-to-country dispute. To that end, we haven’t spent a lot of time evaluating the legality of World Trade Organization rules, but we do know that countries such as Korea, Canada, Mexico, and I think China, have expressed intent to challenge these tariffs before the World Trade Organization.
D. LASCARIS: Given that the Trump administration is obviously not gonna be challenging those tariffs, it is the instigator of them, how would the U.S. solar industry propose to respond to these tariffs? Do you have a plan in place, or formulating a plan in order to deal with this new reality?
DAN WHITTEN: We’re just gonna document the job losses that we have, the losses of investment. There is a midterm review that can take place after two years. Certainly if they find that investment is down, they have the ability to change that. There may be some other ways we can go about fighting this, but it is tough. It’s the president’s prerogative, so it may be awhile before we can get any kind of reversal on it.
D. LASCARIS: And lastly, I understand that there were changes in the Republican tax bill that adversely affected solar power. Is that the case, and what is the nature of the changes? How is that going to adversely affect the industry?
DAN WHITTEN: Well, the tax bill I think was a mixed bag. We were able to sustain or retain the investment tax credit, and so that was a huge deal. That was not a foregone conclusion, so that is still in place. It’s gonna run through its appointed term. There’s still some things we can do on the fringes in terms of tax. There was a provision regarding the financing of solar projects by foreign entities, and it’s hard for us to know exactly what impact that’s gonna have on our businesses, and so we’re still evaluating that, but it wasn’t by itself a positive thing, but taken as a whole, the tax bill was not as bad as it could have been.
D. LASCARIS: Well, this has been Dimitri Lascaris speaking to Dan Whitten, vice president of communications with the Solar Energy Industries Association about a new 30% tariff imposed by the Trump administration on solar energy panels. Thanks very much for joining us today, Dan.
DAN WHITTEN: Thanks, Dimitri. I appreciate it.
D. LASCARIS: And this is Dimitri Lascaris for the Real News.