On January 23rd, 2018, Americans woke up to the news that President Trump has struck yet another blow to the renewable energy industry in the country. Long story short, the US will now impose a 30% tariff on imported solar panels and equipment.
The protective tariffs will begin at 30% for the first year and then slowly decrease in the years to follow. Here is a breakdown of the tariffs per year:
- Year 1: 30%
- Year 2: 25%
- Year 3: 20%
- Year 4: 15%
As of right now, almost 80% of the solar panel installers in the country depend on imported parts for their installations. The solar industry employs over 260,000 people and according to the SEIA, this number will decrease by tens of thousands in lieu of this recent decision.
The decision was made after the U.S. International Trade Commission determined that these imports were harming local manufacturers. These tariffs are being imposed to level the playing field for manufacturers that operate domestically. Both South Korea and China have publicly denounced this move. Seoul said it would go as far as filing a complaint against President Trump for harming international trade.
However, this decision may not be as detrimental to the renewable energy industry in America after all. According to Hugh Bromley, a New York-based analyst at Bloomberg New Energy Finance, this decision will “destruct some demand for new projects in the next two years, but they will likely prove insufficient in magnitude and duration to attract many new factories.”
Undoubtedly, there are two sides to this story. This decision will harm the solar energy sector globally and will become a problem for the local installers as well. We are yet to see how the local manufacturers will benefit from this decision in the coming years. As for us at YellowLite, we believe that this tariff will present a challenge to the solar industry, but it won't stop us from helping in powering America with renewable energy.