TEHRAN, June 07 -President Donald Trump’s tariff on imported solar panels has led U.S. renewable energy companies to cancel or freeze investments of more than $2.5 billion in large installation projects, along with thousands of jobs, the developers told Reuters.
TEHRAN, Young Journalists Club (YJC) -President Donald Trump’s tariff on imported solar panels has led U.S. renewable energy companies to cancel or freeze investments of more than $2.5 billion in large installation projects, along with thousands of jobs, the developers told Reuters.
That’s more than double the about $1 billion in new spending plans announced by firms building or expanding U.S. solar panel factories to take advantage of the tax on imports.
The tariff’s bifurcated impact on the solar industry underscores how protectionist trade measures almost invariably hurt one or more domestic industries for every one they shield from foreign competition. Trump’s steel and aluminum tariffs, for instance, have hurt manufacturers of U.S. farm equipment made with steel, such as tractors and grain bins, along with the farmers buying them at higher prices.
White House officials did not respond to a request for comment.
Trump announced the tariff in January over protests from most of the solar industry that the move would chill one of America’s fastest-growing sectors.
Solar developers completed utility-scale installations costing a total of $6.8 billion last year, according to the Solar Energy Industries Association. Those investments were driven by U.S. tax incentives and the falling costs of imported panels, mostly from China, which together made solar power competitive with natural gas and coal.
The U.S. solar industry employs more than 250,000 people - about three times more than the coal industry - with about 40 percent of those people in installation and 20 percent in manufacturing, according to the U.S. Energy Information Administration.
“Solar was really on the cusp of being able to completely take off,” said Zoe Hanes, chief executive of Charlotte, North Carolina solar developer Pine Gate Renewables.
GTM Research, a clean energy research firm, recently lowered its 2019 and 2020 utility-scale solar installation forecasts in the United States by 20 percent and 17 percent, respectively, citing the levies.
Officials at Suniva - a Chinese-owned, U.S.-based solar panel manufacturer whose bankruptcy prompted the Trump administration to consider a tariff - did not respond to requests for comment.
Companies with domestic panel factories are divided on the policy. Solar giant SunPower Corp (SPWR.O) opposes the tariff that will help its U.S. panel factories because it will also hurt its domestic installation and development business, along with its overseas manufacturing operations.
“There could be substantially more employment without a tariff,” said Chief Executive Tom Werner.
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LOST PROFITS, JOBS
The 30 percent tariff is scheduled to last four years, decreasing by 5 percent per year during that time. Solar developers say the levy will initially raise the cost of major installations by 10 percent.
Leading utility-scale developer Cypress Creek Renewables LLC said it had been forced to cancel or freeze $1.5 billion in projects - mostly in the Carolinas, Texas and Colorado - because the tariff raised costs beyond the level where it could compete, spokesman Jeff McKay said.
That amounted to about 150 projects at various stages of development that would have employed three thousand or more workers during installation, he said. The projects accounted for a fifth of the company’s overall pipeline.
Developer Southern Current has made similar decisions on about $1 billion of projects, mainly in South Carolina, said Bret Sowers, the company’s vice president of development and strategy.
“Either you make the decision to default or you bite the bullet and you make less money,” Sowers said.
Neither Cypress Creek nor Southern Current would disclose exactly which projects they intend to cancel. They said those details could help their competitors and make it harder to pursue those projects if they become financially viable later.
Both are among a group of solar developers that have asked trade officials to exclude panels used in their utility-scale projects from the tariffs. The office of the U.S. Trade Representative said it is still evaluating the requests.
Other companies are having similar problems.
Source:Reuters
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