President Donald Trump’s new tariff on imported solar cells could slow the growth of Montana’s renewable energy industry and cost local jobs while increasing the price of solar installations, the industry said Tuesday.
The Trump administration this week imposed a 30 percent tariff on solar cells and modules imported from foreign makers, despite opposition by most of the U.S. solar industry, including the Montana Renewable Energy Association in Missoula.
Andrew Valainis, the organization’s executive director, called the tariff unfortunate.
“It’s going to increase the cost per panel per watt of an imported solar panel,” Valainis said Tuesday. “A large majority of solar panels being used in the U.S. for installation are imported, and this will essentially raise the cost of panels across the board.”
Two domestic manufacturers of the silicon that’s used to make solar cells and modules filed a petition last year with the International Trade Commission, saying imported components were hurting U.S.-based manufacturers.
The ITC agreed, Valainis said, and offered a range of recommendations to remedy the problem. The Solar Energy Industries Association opposed the recommendations and offered solutions it argued would have been less harmful to downstream U.S. businesses.
“Our biggest concern here in Montana is, this whole subject was supposed to support American manufacturing, but this (tariff) won’t necessarily boost the industry in the way that’s largely been discussed,” Valainis said. “It may harm the industry.”
The tariff could slow job gains across the industry, which has expanded at more than 20 percent annually in recent years. Last year, there were about 260,000 solar workers in the U.S., or five times that of the coal industry, according to the Solar Foundation’s latest jobs census.
Valainis said that same census found 168 solar jobs in Montana in 2016, up from 109 the year before. Growth in the industry would occur faster with less government interference and more support, he said.
“Most of the American solar industry is installers, and here in Montana, 80 percent of the industry is installers,” Valainis said. “Not only that, they’re small businesses. And while the Montana industry is resilient and can overcome this burden, it’s just another example of how the federal government isn’t supporting the solar industry.”
The tariff is expected to serve as a boon to SolarWorld and Suniva – both bankrupted companies based in the U.S. but foreign owned. In their complaint to the ITC, they said their Chinese competitors enjoy government subsidies and, as a result, can import products they can’t match in price.
But for the downstream industry, the administration’s tariff could be detrimental. When coupled with the elimination of the income tax credit for solar installation, Valainis said, it serves as another road block for an industry set for growth.
“Most of the times at the Legislature we end up playing defense against people who, similar to this tariff, want to move legislation forward that’s just going to harm the industry,” Valainis said. “That’s such a shame because these are well-paying jobs, local jobs and small businesses, and it’s money back in the economy.”