A new report commissioned by the Coalition for Affordable Solar Energy (CASE) indicates that the imposition of trade tariffs on solar equipment imported to the USA would be detrimental to the American solar industry.
CASE commissioned the report from consulting firm The Brattle Group, which examined the impacts that a 50 per cent and a 100 per cent import tariff would have.
The report found that such tariffs would slow demand for solar photovoltaic (PV) systems in the USA and result in job losses. “Even under the most conservative assumptions, we did not find a scenario where imposing a tariff would create more jobs than it eliminates,” said Dr. Mark Berkman, author of the report.
The report was commissioned after a group of solar equipment manufacturers, led by German firm SolarWorld, lodged a complaint with the US Commerce Department over unfair trade practises by Chinese solar equipment manufacturers.
The Commerce Department is investigating SolarWorld’s claim that Chinese firms have been ‘dumping’ solar products on the US market at less-than-fair value in order to gain market share. The action has split the US solar industry and has also resulted into an investigation by the Chinese government into the trade practices of US solar firms exporting goods to China.
In January a coalition of wind turbine tower manufacturers launched a similar complaint with the US Commerce Department regarding companies in China and Vietnam.
CASE says that any trade tariffs imposed on Chinese imports as a result of the US government investigation would be “devastating”. “We cannot allow one company’s anti-China crusade to threaten the US solar industry and tens of thousands of American jobs, said Jigar Shah, President of CASE.
SolarWorld is calling for tariffs of up to 250 per cent. The Brattle Group study shows that a tariff of 100 per cent would result in consumer losses of between $698 million and $2620 million over the next three years.
Brattle Group’s analysis also indicates that without a tariff, the aggregate demand for PV systems in the USA is expected to grow from 1678 MW in 2011 to 4894 MW by 2014. “A 50 per cent tariff will raise industry-wide prices and delay solar industry growth, with total MW demand falling to as low as 3350 MW in 2014. A 100 per cent tariff will delay this growth even more with demand falling to as low as 3159 MW in 2014,” says the study.
The SolarWorld-led group of manufacturers, known as the Coalition for American Solar Manufacturing (CASM), has called the Brattle Group study “highly speculative”. “We do know that thousands of good-paying American manufacturing jobs have already been lost to illegal Chinese dumping and subsidies for solar products,” said CAME in a statement. “Our goal is to build America’s solar manufacturing base and the good jobs with benefits, innovation and competition that come along with it.”