- The Solar Energy Industries Association (SEIA) and several renewables developers urged the International Trade Commission (ITC) to remove or rethink the tariff on solar cell imports at a Thursday hearing, highlighting a report that shows 62,000 downstream solar industry jobs will be lost due to the trade restriction.
- However, solar manufacturing companies maintain demand is being met for solar cells and the tariff needs to remain in place to safeguard U.S. companies as they grow. Hanwa Q Cells and other manufacturers asked the ITC to at least double the annual tariff-rate quote from 2.5 GW of cells, based on expected demand.
- The ITC is required to submit a report on the solar cell industry and the tariff impacts by Feb. 7, 2020, the mid-point of the tariff period that began in January 2018. Two years are left on the solar tariffs, although President Donald Trump can increase that measure.
SEIA and other solar developers argued at the ITC today that the Section 201 tariff has not brought the desired boom to the U.S. solar industry, but the number of solar manufacturers defending the trade policy has grown.
When the ITC initially heard the case for imposing solar tariffs in 2017, two sole solar manufacturers were pushing them: SolarWorld and Suniva, which were both facing bankruptcy. Now, at least five manufacturers are benefiting from the tariff: Suniva, which emerged from bankruptcy in April, Korean manufacturer Hanwa Q CELLS, which has opened a new manufacturing facility in Georgia, LG Electronics, SunPower which bought SolarWorld USA, and California-based Auxin Solar.
"Your actions have allowed for a renaissance to begin," Suniva President and COO Matt Card told the ITC.
Besides advocating to keep the tariffs in place through 2022, many manufacturers asked to increase the trade-rate quota from 2.5 GW to 5 GW annually, based on manufacturers' estimates that demand will increase, and the need to further protect domestic production.
"There is no shortage of modules, in fact there is global oversupply," Andy Munro, General Counsel of Hanwha Q CELLS USA, told commissioners.
Tariff opponents warn of job loss
The recent manufacturing upticks are largely automated operations, and the amount of jobs created pales in comparison to the downstream jobs lost since the tariff went into effect, Matthew Nicely, attorney with Hughes Hubbard & Reed, representing SEIA, told the ITC.
Downstream construction jobs have a "transient nature," and cannot be compared with manufacturing jobs, Brian Lynch, solar director for LG Electronics USA, said during the hearing. Hanwa and LG are among the largest solar cell manufacturers in the world.
SEIA's report, released Tuesday, said from 2017 through 2021, the tariff will prevent $19 billion of solar investment, along with the loss of 62,000 jobs and 10.5 GW of solar deployments by raising the price on systems and preventing development. SEIA's market impact analysis tracked a decrease in solar jobs and investments from the start of rumors about Suniva bringing a case to the ITC.
White House trade adviser Peter Navarro criticized the report on Wednesday, according to Bloomberg, calling it "fake news wrapped up in academic mumbo jumbo."
SEIA's Hopper invited Navarro to a solar industry conference in response.
"We look forward to working with the Trump administration on ways to advance real manufacturing growth without these particularly counterproductive tariffs," she said in a statement.
Potential for a slow down in tariff rates
SEIA and other solar developers fear "that the administration will somehow make [the tariffs] harsher," CEO Abby Hopper told reporters.
The tariffs started at 30% in 2018 and are set to phase down 5% each year while they're in effect, ending in 2022. Proponents of maintaining the tariffs want to see a continuation in the phase down of the rate, but at a slower pace.
ITC Chair David Johanson asked Suniva specifically what rate reduction would be appropriate, but the company representative did not have a specific answer.
"Any latitude, any grace that the commission thinks [appropriate] is better than none," Card said.
Parties can continue to submit comments for the ITC's consideration until Dec. 12.