At 11.07 AM this morning, in Washington DC, the United States International Trade Commission ruled 4-0, in agreement with Suniva that the US Solar Panel industry has suffered harm from the global solar manufacturing industry.

The process now follows that on October 3rd, this group will have hearings on what the remedy to this injury should be. On October 13th, they will vote on a remedy to recommend to the President. The President has until January 12th to respond with the offices final ruling on what those remedies will be. See bottom of the article for full schedule.

In April of this year, Solar panel manufacturer Suniva, who recently filed for bankruptcy, filed for “global safeguard relief” from imports of crystalline silicon solar PV cells and modules. On May 17th, the ITC accepted the case and notified the world that any solar panels brought into the United States after that date would be liable for later tariff applications.

Suniva has requested that any solar cells brought into the US have a tariff of 40¢/W added and that any solar panels have a minimum price of 78¢/W. Current solar panel prices range from 32¢/W up to $1/W for ultra premium products. By my guess – the average price of solar panels in the USA is between 30-55¢/W – meaning this ruling might increase solar panel pricing by 23-48¢/W.

If their request is approved, the effect in the industry will vary based upon the sector of the industry – utility-scale development will feel it the most, with residential the least. Since US utility-scale projects now cost just over $1/W, and since these groups were probably getting the best pricing on solar panels – 30¢/W possibly – they could see a price increase of up to 48¢/W. That would increase utility-scale development pricing up to 45%. Since commercial and residential projects are priced much higher, and their hardware costs are higher as well, they could see a price increase ranging from 12-25% for commercial solar projects, and 8-15% for residential solar projects.

The SEIA predicts that as many as 88,000 jobs could be lost in the industry. Their analysis is broken down on a state by state basis. The logic used is based upon the assumed new price of a solar panel installation in each state and the probability of solar power being installed. South Carolina is predicted to lose 90% of its jobs in the solar power industry. For an industry that is growing 17 times faster than the broader US economy, and represented 1 in 50 new jobs in 2016 – this could have an effect, though limited, on the broader US economy. Tesla pulled its SolarCity arm from the state in June, possibly in anticipation of this ruling. An interesting quote:

“If we’re talking about a 40 cent per watt increase … it would take out a lot of projects,” said Morten Lund, a solar industry attorney for Stoel Rives, which currently represents SolarWorld in matters unrelated to the trade case.

“I’m not worried about California. I’m not worried about the Northeast,” said Lund, noting that large solar projects will move forward in states with renewable energy mandates, regardless of price. But in states like Texas, tariffs could “completely obliterate the utility market.”

Since the Solar Safeguard Case won’t have a final remedy ruling for several months, expect there to be a chill on construction while groups wait. News outlets have suggested from quotes inside of the White House that, Trump is 90% likely to impose some sort of import tariffs. Other speculation has run that since the majority of the industry damage has come from Chinese manufacturing, it could be that tariffs will only be imposed on product coming from companies that are associated with Chinese funding of manufacturing. Singapore and Canada were not included in the scope of injury – apparently REC Solar produces panels there and might benefit from the ruling. Domestic solar panel producer First Solar will possibly benefit the most – and its stock price is up much today.

The last time the USA added an import tariff to Chinese solar panels, China responded with a harsh import tariff of its own on US produced polysilicon. The result of this was that REC Silicon ceased polysilicon production in the USA as China ramped up its own production and began purchasing from neighbor South Korea.

The next most important date is January 12th, or earlier, as we await the President’s reaction to the ITC remedy recommendation.

Solar Safeguard Case timeline:

Header image courtesy of the UL Fire Research lab

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