Donald Trump has decided to impose customs tariffs on solar panels arriving from Asia. A measure that could hit the renewables sector in the United States hard.
Solar panels arriving in the United States from Asia will henceforth be subject to heavy customs tariffs. A tax of 30 per cent for the first three years, which will subsequently fall to 15 per cent. United States President Donald Trump has thus moved from words to action: an ultra-protectionist measure with which he aims – in theory – to safeguard American production.
https://www.youtube.com/watch?v=bnP2SJKWCII
Alongside solar panels, customs duties will also be applied to washing machines: 20 per cent on the first 1.2 million domestic-use units, rising to 50 per cent on further imports. The decision was taken, it should be noted, on the basis of a recommendation put forward by the International Trade Commission, a body made up of Republican and Democratic members of Congress.
According to Jeff Fettig, owner of the American home appliance manufacturer Whirlpool, "this is a victory for American workers and consumers." The executive also assured that the tariffs will make it possible to create new jobs in Ohio, Kentucky, South Carolina and Tennessee. But there are those who believe, on the contrary, that the decision could have significant consequences for the American renewable energy market.
Fundamental to the process of energy transition, solar panels could indeed face a significant rise in average price. A factor that could discourage consumers. The Washington government nevertheless decided to heed the complaints of a bankrupt company, Suniva, and the American subsidiary of the German group SolarWorld. Both companies had pointed the finger at the surge in solar panel imports, particularly from China.
Trump has imposed 30 per cent tariffs on solar panels imported into the United States. It's a stupid decision, bad for the Earth, and it will hurt the industry, but it is actually a temporary step backwards. Panels account for 30 per cent of the cost of an installation, so the customs duties will amount to 10 per cent of the total. This will push costs back to 2016 levels. At the current rate of decline, prices will return to current levels within a year and a half. Furthermore, the duties apply only to silicon panels, not for example to thin film Ramez Naam
According to data provided to the Donald Trump administration, the volume of Asian products on the United States market had multiplied sixfold over the past five years. Enough to bring about a collapse in prices. One that may have hit some American companies hard, but that has undoubtedly given a decisive boost to the sector (from which American companies in the supply chain have also benefited). It is no coincidence that the American government's decision provoked a sharp reaction from the Solar Energy Industries Association, which argues that the new policy will delay or prevent the finalisation of billions of dollars in commitments. And it will cost the renewables sector 23,000 jobs.
Less negative is the view of Ramez Naam – an expert in energy and environmental systems – who argues that the impact of the tariffs should be kept in perspective and that the sector will be able to respond to the offensive.
It will also be necessary to see what view the World Trade Organisation (WTO) takes on the matter. There is indeed a precedent that could block Donald Trump's plan. The law on which he based his invocation of a "safeguard necessity" for the American production system dates back to 1974. Since then, it has been used only once: in 2002 by then President George W. Bush, to protect American steel. But in that case Washington was forced to back down, precisely because the WTO censured the decision.
