Donald Trump wyd? That’s been the collective response to the Trump administration’s new tariff on imported solar panels and equipment.
Only U.S. solar manufacturers, who asked that the tariffs be put in place, seem to be happy (though they wanted higher tariffs). But overall, the solar industry is not stoked for the simple reason that this move will likely kill jobs. Specifically, it will kill blue collar jobs in the fastest-growing field in the U.S., which is ironic given the administration’s aggressive courting of blue collar votes.
The ruling puts four years of tariffs in place, starting at 30 percent the first year and declining to 15 percent by the end. Analysts project that costs could rise 4 percent for rooftop solar and 10 percent for utility scale solar plants. The result will be a net reduction in installations by roughly 10-15 percent over the next five years.
That will effectively strangle one of the most vibrant sectors of the solar industry, which is itself one of the most vibrant sectors of the economy. More than 137,000 of the 260,000 people employed in the solar field work in installation according to the Solar Foundation’s Solar Jobs Census.
Prior to the tariff, the Bureau of Labor Statistics forecast that the number of solar photovoltaic installers would grow 105 percent over the next 10 years. That far outpaces construction trade jobs, which are only expected to grow 11 percent over that period, and puts it at the top of the list of fastest-growing jobs.
The new tariffs will almost certainly make that forecast obsolete as they will drive up installation prices by either forcing companies to buy more expensive American-manufactured solar equipment or pay fees on cheaper equipment made abroad.
That means demand for solar installers will be lower, which means fewer installation jobs.
“There will be a hit on jobs, mostly among utility-scale solar installers rather than residential,” Ramez Naam, an energy investor and lecturer at Singularity University, told Earther. “There will be fewer jobs lost than some have feared, but it will still be thousands.”
It’s exceedingly unlikely that the tariffs will result in an attendant increase in solar manufacturing jobs because plants are becoming highly automated. Quartz also aptly notes that of the two bankrupt companies that filed the complaint that led to tariffs, Sunviva is majority-owned by a Chinese investor and Solarworld is the U.S. wing of a German solar company. So it’s not even clear how this fits with the ever-morphing concept of “America First.”
According to the Solar Energy Industries Association, a trade group representing 1,000 solar companies in the U.S., the tariffs will result in a net loss of 23,000 jobs. Greentech Media has forecast that California, Texas, Florida, Georgia and South Carolina will see the biggest drop in potential solar installations, showing that red states will be hit just as hard as blue states and electoral-bellwether Florida.
To stave off some of the job losses, states have a couple tools at their disposal. One of those is the renewable portfolio standard, which requires energy companies to generate a specific percentage of their electricity from renewables. The goals of those standards have been to cut carbon pollution, but they have also helped make renewable jobs a growing part of many states’ economies.
“Those policies will shield the industry somewhat from these tariffs, though not completely,” Naam said. “2018 would be a great time for states to lift their goals higher for how much of their electricity comes from solar and wind.”
Leah Stokes, an energy policy researcher at the University of California, Santa Barbara, told Earther that states could also look to tax credits similar to those for electric vehicles of improving energy efficiency as another avenue to keep installation on pace.
“That said, it’s an expensive policy and states might not be willing to pay for it,” she said via email. “These policies can also be designed poorly so that government ends up paying more than is necessary.”
If nothing is done, Naam said that this move likely puts U.S. solar installations about a year behind schedule. But the drag comes at a time when the U.S. (and the world) need to do more to reduce carbon emissions and slow down that good old global warming.
The U.S. should be incentivizing people to install panels on their home and energy companies to build solar power plants. It’s possible this move will only be a speed bump, but the world can’t afford to slow down for speed bumps when it comes to climate action.
Of course it’s unlikely that Trump cares from a climate perspective. But for a president who has tweeted about jobs 89 times since taking office, including various lowercase and capitalized versions of the phrase “jobs, jobs, jobs!” 14 times, it really is a head-scratcher.