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Could Trump be About to Kill U.S. Solar Industry Jobs?

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Photo by Intel Free Press | CC by 2.0

I recently returned from Bavaria (Germany). When I give presentations in the U.S. extolling the virtues of the German Energiewende (energy revolution) I often brag about Bavaria. There, I say, in possibly the most conservative province of Germany, farmers have put solar panels on their barn roofs. There may be no cows in the barn, but they are certainly farming solar energy.

But after driving through Bavaria last month I realized that, all this time, I had been the master of understatement.

Traveling through the U.S. you may spot the occasional house sporting a handful of solar panels on the roof. But Bavarian barn roofs are completely covered in solar panels. So are the farmhouses, the sheds, the schools and other public buildings. There may be tiles on these roofs but you can’t see them. In cloudy Germany, where there is already snow on the mountains and we were wearing our woolly sweaters in mid-September, solar power is everywhere.

For sure there are some strong incentives in Germany — such as the feed-in tariff and grid priority for renewables. Nevertheless, the contrast with the U.S., where a shameful one percent of electricity is generated by solar energy, is striking.

Now, that contrast could be about to become even more stark.

Two US solar companies seek to stifle the rest of the industry

Last month, the International Trade Commission, in a 4-0 vote, sided with two American solar manufacturers who had filed a petition under Section 201 of the Trade Act seeking relief from foreign manufactured solar cells. The petition only had to show that the two companies — Suniva and SolarWorld Americas — could not compete because of the import of cheaper solar cells, mainly from China but also Mexico. They were not obliged to demonstrate malicious intent by their rivals.

Ironically, the two companies in question have foreign roots. Suniva is owned by Chinese venture capitalists who simply want their money back. The parent company of SolarWorld Americas is German, although the U.S. division is fiscally independent.

The Solar Energy Industries Association (SEIA), estimates the ruling could “more than double the cost of solar and put 88,000 jobs at risk.”

In Germany, cheap Chinese solar panels were welcomed. The more the merrier. The Germans lent their domestic expertise to other areas of the supply chain— their engineering prowess. By 2007 and 2008 “six German firms were among the top 10 suppliers of photovoltaics manufacturing equipment, and German engineering firms are still leaders in this market segment today,” wrote Craig Morris and Arne Jungjohann in their book, Energy Democracy: Germany’s Energiewende to Renewables.

Germany’s savvy realization that it was pointless to compete with Chinese panel manufacturing and thereby stifle progress on German soil had one inevitable outcome: Solar implementation boomed.

In the U.S., depending on the recommendations ultimately adopted by the ITC, the ruling could make a serious dent in solar panel supply, dealing a potentially fatal blow to what was a boom in private and utility scale solar installation. Without a wealth of panels, all the other industries involved in the U.S. solar energy chain will take a hit.

Solar storms in an industry reeling at a decision that could kill it

Since the ruling, and a backlash from virtually every other quarter of the U.S. solar energy sector, Suniva has backed down from its original demand for a 40-cent-a-watt tariff on CSPV cells to a tariff of 25 cents per watt. It has also reduced its demand for a 78-cent-a-watt floor on module prices, to 32 cents per watt. SolarWorld has also modified its position.

The SEIA has answered back with its own petition, claiming the tariffs would push the price of solar cells higher, hurting demand and jeopardizing U.S. jobs and even the future of what was becoming a vibrant U.S. solar industry.  The “rise in solar costs would slash demand. Solar project costs would rise dramatically for both rooftop and utility scale, and solar would become less competitive,” said SEIA in a document laying out the solar industry’s view.

In a charged October 4 hearing before the ITC, Suniva and SolarWorld reaffirmed their case while a chorus of opponents from the solar industry also spoke out. The ITC will have until November 13 to finalize its recommendations. Those will then go to the desk of President Trump who will have 60 days to accept or reject them.

If the ITC continues to support the two companies and rules against recommendations from the SEIA and others, this will pose an interesting dilemma for Trump. Will he decide to sign, in order to punish China? To add further argument to his climate denier case? Or will he refuse to sign, in order to protect those 88,000+ American jobs, a cornerstone of his pre-election rhetoric?

Our guess is he will sign it because his ardor for American jobs was just a callous cover story to get votes. He has done virtually nothing since the election to protect them.

This prognostication is supported by the move just made by U.S. Energy Secretary, Rick Perry, who asked the Federal Energy Regulatory Commission to issue and implement a rule that would effectively subsidize the economically failing coal and nuclear sectors.

The solar industry already employs more people — around 374,000 — more than nuclear (76,771) and coal (160,119) combined, according to 2016 figures from the DOE. Perry’s request is, as NRDC lawyer, Miles Farmer, rightly described it, “insane.” A word of course all too often associated with any decision emerging these days from the White House.

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Linda Pentz Gunter is the international specialist at Beyond Nuclear. She also serves as director of media and development. 

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