A new economic analysis commissioned by the Coalition for Affordable Solar Energy (CASE) shows a 100 percent tariff on solar panel imports into the US would irreparably slow growth of the nation’s rooftop solar power sector.
The study, prepared for CASE by consultancy firm The Brattle Group, found this would result in up to 50,000 net lost jobs in the U.S. over the next three years. Furthermore, retaliatory tariffs placed on U.S. exports of polysilicon to China – a sector of the solar industry the US dominates – would put nearly 11,000 more American jobs at risk in the first year following tariff imposition.
The report comes just days after claims from the Coalition for American Solar Manufacturing (CASM) that in the last months of 2011 Chinese companies doubled imports of cheap solar panels in an effort to escape tariff increases from the US Dept. of Commerce. CASM is demanding the US government increase tariffs on Chinese solar imports by 250 percent to counteract what is says are illegal subsidies for Chinese solar panel makers.
CASE and CASM are the two organisations on opposing sides in the USA’s "solar trade war". CASM – led by Germany’s SolarWorld AG and five unnamed companies, says China is "crippling the US solar industry," and has filed antidumping and countervailing duty petitions with the US government. SolarWorld’s US arm, SolarWorld USA, has panel manufacturing facilities in Oregon.
The Brattle Group report considers the impact of imposing both a 50 percent tariff and a 100 percent tariff on the U.S. solar industry through 2014 – far lower than the 250 percent demanded by CASM.
Under the modelling, any increase in tariffs would substantially slow growth of solar PV in the USA, resulting in consumer losses between $698 million and $2,620 million. A 50 percent tariff would shut the vast majority of Chinese imports out of the US market, and a 100 percent tariff would effectively block them altogether.
While this may provide domestic manufacturers with some assistance in the short term, increased module prices of around 25-30 percent would lower demand from homeowners, resulting in net losses for the sector overall.
"This analysis makes it clear that imposing even a 50% tariff, much less than SolarWorld has requested, would be devastating for American workers," said Jigar Shah, President of CASE. "We cannot allow one company’s anti-China crusade to threaten the U.S. solar industry and tens of thousands of American jobs."
According to the Brattle analysis, if no tariff is imposed “the aggregate demand for photovoltaic systems is expected to grow from 1,678 MW in 2011 to 4,894 MW by 2014.
The Brattle Group’s full report entitled "The Employment Impacts of Proposed Tariffs on Chinese Manufactured Photovoltaic Cells and Modules" can be viewed here (PDF).
