Time to end the solar panel tariffs
One sign of an industry nearing maturity is its growing desire for government help, be it in the form of subsidies to plug the holes in its balance sheet, or protection to keep competition at bay.
Parts of the solar industry are reaching maturity, because they are looking for government to extend tariffs on foreign-made solar panels. And they are spinning this bid for government help as a national security issue.
According to the Wall Street Journal:
Auxin Solar Inc., a San Jose, Calif., solar panel manufacturer, and Suniva Inc., which owns an idled solar cell factory in Norcross, Ga., plan to ask the U.S. International Trade Commission…to extend the solar tariffs for four years, said Mamun Rashid, Auxin’s chief executive officer.
The 18% tariffs were imposed in 2018, and are set to expire next year. They largely affect imports from Chinese-owned companies. China is the world’s largest producer of solar cells and panels used to generate electricity, although it has moved some of its production to elsewhere in Asia to avoid U.S. tariffs.
The companies say extending the tariffs is necessary to “secure America’s solar energy independence” and to “rid the solar supply chain of injurious and unfair trade practices” that hurt American workers, according to a copy of the petition.
“It’s a national-security concern,” Mr. Rashid said.
Credit to the solar companies for their shrewd two-fer: “national security” and “China” are both popular buzzwords that can motivate government to act without much thought. The only thing missing is “industrial policy,” which would complete the buzzword trifecta, and all but ensure the feds leap into action.
But not all solar companies are on board with the protectionist pitch:
Tariffs provide an incentive for domestic manufacturing of solar panels—an industry that has been eviscerated by cut-rate Chinese competition.
But they also raise the cost of solar panels to business and residential customers, potentially slowing the spread of the clean technology.
“It is time to end the job-killing Section 201 solar tariffs,” said John Smirnow, general counsel for Solar Energy Industries Association, a trade group whose membership includes importers and installers. “They are a multibillion-dollar drag on industry growth.”
Who pays the higher costs? Not China. It’s people who buy those tariff-protected solar panels. Time to let the tariffs go, and allow the market to do its thing.