The Trump administration has recently signed tariffs on imported solar panels and washing machines in an effort to promote American businesses. For washing machines, the administration approved a 20 percent tariff on the first 1.2 million washing machines sold and then a 50 percent tariff on all washing machines sold after that in the next two years. For solar panels, the administration has approved a 30 percent tariff that will decline to 15 percent after four years. US Trade Representative Robert Lighthizer said in a statement that “increased foreign imports of washers and solar cells and modules are a substantial cause of serious injury to domestic manufacturers.”
While there has been little response to the washing machine tariff, this is not the case for solar panels. There is now a divide in the solar panel industry over the costs and benefits of this new tariff. American-based manufacturers support this decision because they no longer have to compete with the much cheaper panels available overseas. One such company, Solar-World, praised the president’s new tariff. The company released a statement shortly after, saying “Solar-World Americas appreciates the hard work of President Trump, the U.S. Trade Representative, and this administration in reaching today’s decision, and the President’s recognition of the importance of solar manufacturing to America’s economic and national security. We are still reviewing these remedies, and are hopeful they will be enough to address the import surge and to rebuild solar manufacturing in the United States.” There are two major solar panel companies in the United States that so far have had to compete mostly with overseas companies that could produce solar panels at a cheaper rate. According to solar panel company Suniva, this tariff will also help them create more jobs in their company.
For solar panel installers, the tariff is a risky move that could actually cost jobs. According to NPR reporter Jeff Brady, “[s]olar panel prices have fallen by more than 70 percent since 2010, according to the Solar Energy Industries Association. For many homeowners installing solar panels has become more affordable, but now the industry’s main trade group worries that if prices go up the installation boom could come to a halt.” For installers, the tariff on solar panels from overseas that made solar panels an affordable option to more American households, will decrease the demand for solar panels across the country, thus creating less of a demand for installation. According to a study by Reuters, only 14 percent of solar panel jobs are in manufacturing with over 80 percent of jobs in installation. According to the Solar Energy Industry Association’s president and CEO, Abigail Ross Hopper, “they [the Trump Administration] will create a crisis in a part of our economy that has been thriving, which will ultimately cost tens of thousands of hard-working, blue-collar Americans their jobs.”
For others though, the tariff on solar panels is less about jobs and more about the environment. With solar panels more expensive, less everyday-Americans will see them as a viable option for energy. This will then promote traditional polluting forms of energy that contribute to climate change. Environmental activists point to Trump’s history of climate change denial and his refusal to sign the Paris Agreement for evidence that this decision is not just about American businesses, but also a way to further promote an agenda that supports contaminating energy sources like coal. Overall, the new tariffs will change the solar panel market in the United States. That this change is for the better though, is yet to be seen.