Trade panel puts solar tariff decision in Trump’s hands

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President Donald Trump is pictured. | Getty

President Donald Trump has not weighed in on the case so far, though his administration has re-opened the landmark NAFTA agreement with Mexico and China. | Saul Loeb/AFP/Getty Images

A federal trade panel declared Friday that surging imports of solar panels have hurt U.S. manufacturers — a decision that will allow President Donald Trump to penalize Chinese companies but could also choke off the fast-growing green energy industry in the U.S.

The U.S. International Trade Commission voted to uphold a complaint brought by two domestic solar manufacturers that complained that the low-cost imports had damaged their businesses. The decision was opposed by the much larger U.S. solar installation industry, which has seen the influx of the cheap panels spark a boom in construction of giant solar farms and rooftop systems around the country.

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The issue will give Trump the opportunity to erect trade barriers he has hailed as key to his strategy to revive domestic manufacturing, and at the same time hit the Chinese companies that have largely evaded previous U.S. import penalties to become the leading suppliers of solar cells and panels. Administration officials say the trade case hasn’t been a central one for the president, but they are increasingly confident Trump will favor tariffs when the commission sends the White House its recommendations in the next couple of months.

The case could also give Trump a platform to advance his “America First” agenda and tout his effort to revive the ailing coal sector. Coal companies have complained that the Obama administration waged a regulation-heavy “war on coal” while tilting federal tax incentives and loans to renewable energy sources in order to advance climate change policies.

“[Trump] could easily reward his buddies in the coal industry who would really like to see high-priced solar panels competing with coal for space on the grid,” said Clark Packard, a policy analyst and trade lawyer with the conservative think tank R Street Institute, which opposes tariffs. He added: “He may just want to stick it to people — your coastal elites who never would have voted for him who are more likely to use solar panels. He’s looking for any circumstance to impose tariffs, it doesn’t seem he cares what they are.”

Trump has not weighed in on the case so far, though his administration has re-opened the landmark NAFTA agreement with Mexico and China, and he has regularly blasted China and other countries for what he calls unfair trade with the U.S.

“He’s a protectionist, there’s no doubt about it, and he’s not very sympathetic to the renewable energy,” Gary Hufbauer, senior fellow for the Peterson Institute of International Economics. “As much as you can predict any president, I think his conclusion is foregone.”

The complaint brought by Georgia-based Suniva and Oregon-based SolarWorld USA has brought sharp opposition from most of the U.S. solar industry, which has seen its growth skyrocket as costs for the technology fell to a fraction of what they were a decade ago. Aided by federal tax incentives and state-level programs, large solar power installations have sprung up across the country, driving down costs for those plants to levels that are now competitive with coal and natural gas power power stations. That’s lifted employment in the sector to 260,000 even as the number of U.S. companies that make solar cells and panels sinks.

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The solar industry has warned that high tariffs would eliminate 88,000 U.S. jobs by boosting costs and making many projects uneconomic just as the industry, which generates $29 billion in revenues, was starting to stand on its own.

“If companies are going to be injured, we’re going to be bringing in employees who will lose their jobs, mayors and governors and senators and representatives,” said Abigail Ross Hopper, head of the Solar Energy Industries Association. “We’re going to be making sure folks understand the impact, and putting a human face to it.”

The four members of the ITC will now begin to formulate a remedy to address the injury suffered by the U.S. manufacturers, and they will take recommendations from solar companies. Any remedies taken by the U.S. will not apply to imports from Canada.

Suniva brought the case under Section 201 of the Trade Act, a rarely used but powerful tool that gives the president the ultimate authority to take or discard the recommendations of the commission. Most trade complaints — including two solar cases acted upon by the Obama administration — are limited to imports from specific countries, but Section 201 allows the president to impose tariffs on all imports of a product. The authority was last used by President George W. Bush in 2002 to implemented a tariff on imported steel, but it was withdrawn 15 months later.

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US trade agency rules imports harmed solar panel makers, setting up Trump tariff decision

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Original article.

A federal trade agency ruled on Friday in favor of U.S. solar panel manufacturers seeking protection from imports, a move that will potentially disrupt demand for fast-growing renewable energy installations.

The U.S. International Trade Commission’s preliminary finding that imports harmed U.S. manufacturers means President Donald Trump will get to decide whether to slap sanctions on foreign solar panels and modules or take other actions.

Bankrupt solar panel-maker Suniva filed the complaint with the U.S. International Trade Commission earlier this year, arguing that a surge in imports of cheap foreign panels and modules was putting U.S. manufacturers at risk. Along with SolarWorld, another bankrupt panel maker, Suniva said the flood of overseas supplies directly contributed to its insolvency.

The two companies sought penalties of 40 cents per watt on imported cells and asked the court to set a floor price of 78 cents per watt on solar modules, or groups of solar cells.

The motion was opposed by broad swaths of the solar power industry. Led by the Solar Energy Industries Association, the opponents say tariffs will raise the cost of solar panels and sink demand for installations, hurting the industry as a whole. They allege Suniva and SolarWorld’s bankruptcies are due to poor business decisions.

Shares of First Solar were briefly halted on the Nasdaq due to volatility. Shares were up about 5 percent after the decision.

Suniva and SEIA each commissioned reports that showed a ruling for their opponent would result in devastating job losses. An independent analysis by Bloomberg New Energy Finance performed for Utility Dive found a ruling for Suniva would created 6,400 jobs at most and “downstream job losses would almost certainly exceed any manufacturing gains.”

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Today’s Wind and Solar Can Lead to a Safer Climate Tomorrow

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This is part of a series of blogs on NRDC’s new report, “America’s Clean Energy Frontier: The Pathway to a Safer Climate Future.

Experts agree that staving off the worst impacts of climate change will require the United States and other nations to reduce carbon emissions by at least 80 percent (from 1990 levels) by the middle of the century. The extreme weather dominating the news this fall make it more clear than ever that we need to get this done. But what is the best way to make the deep carbon cuts we need? Renewable energy needs to play a major role.

New, comprehensive modeling by NRDC and Energy + Environmental Economics (E3) outlines a cost-effective pathway to a climate-safe future that relies on today’s proven clean energy solutions. The big news here is not just that we can do it. It’s how—with a bold and rapid expansion of energy efficiency, renewable energy and the electrification of vehicles and buildings with clean power, all supported by a modernized grid. We don’t need to wait for new breakthroughs, and we don’t need to rely on risky or costly strategies like nuclear power, biomass, and carbon capture and storage (CCS).

What we do need is to keep pushing forward—hard—on existing clean energy solutions. On the renewable energy front alone, we need 70 percent of U.S. electricity to come from wind and solar power.

This blog focuses on what we need to do under this climate pathway on the renewable energy front—we will need at least 13-fold increase in wind and solar by 2050, alone, to achieve this vision. That might sound ambitious, but given the dizzying pace of renewable energy development, it’s definitely within reach, and it’s represents less than 1 percent of our solar potential and less than 10 percent of our wind. U.S. wind and solar have grown 23 percent and 60 percent, respectively, over the past decade. Their growth accounts for more than half of all the new power added to our electric system. And according to Bloomberg New Energy Finance, this rapid expansion of renewable energy is a long-term trend.  

The sun may set, but the savings are rising

Steep price declines have played a major role in this growth and will continue to do so. The cost of solar PV (generation from photovoltaic panels) has declined by almost 85 percent in less than a decade. Analysts expect solar to become the lowest-cost form of new power in the United States by 2023–even after federal tax credits expire—and to be less expensive than existing fossil generation by 2027 across the country. In some parts of the country, solar is already cheaper than fossil fuel energy. 

At the same time that solar prices have been plummeting, the average price for electricity from wind (bought through what are known as long-term power purchase agreements of PPAs) have dropped more than 70 percent, from $70 per megawatt-hour (MWh) in 2009 to less than $20/MWh in 2016, according to the Department of Energy. That’s at the bottom end of the average for wholesale power, which ranged from $20 to $45/MWh in 2016 depending on the region, and it means lower utility bills and cleaner air for consumers, too.

Wind off our shores

To reach the levels of wind power required by 2050 in our modeling scenario, however, the federal government and states will need to adopt policies to pick up the pace of the nascent U.S. offshore wind industry. The first offshore wind facility was launched off Rhode Island in December 2016, and today 14 more are in the planning phase. The DOE sees the potential for 22 GW of offshore wind by 2030, but that won’t be enough to match the growth called for by our analysis. To get there, we’ll need federal policies such as a tax credit targeted at offshore wind and we’ll need the Department of Interior to continue to map out appropriate areas for offshore wind development. 

And we’ll need west coast states to join offshore wind state leaders like New York, Massachusetts, Rhode Island, and Maryland in committing to scale up offshore wind, just as European countries have done for the past twenty years.

How can we ensure that renewable energy continues to move forward at the rate we need to secure a safer climate future? Smart state policies, such as strong renewable portfolio standards that require a specific amount of electricity generation to come from renewable resources, reforming utility business models, and enabling renewable electricity purchases by consumers and corporations to spur investment in clean energy are more critical than ever.

Meanwhile, large-scale renewable energy projects should be “smart from the start” and sited to avoid conflicts with environmental, military, or community concerns. As noted above, we need to tap just a fraction of our potential; we can build the renewables we need and protect our land and wildlife. Maintaining federal tax credits for renewable projects also gives the industry the certainty it needs to plan for future expansion—a luxury enjoyed by the oil and gas industry for more than a century. (The most recent federal tax incentives extension is projected to add 220,000 jobs and inject $23 billion into the US economy in 2017 alone.)

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