Solar innovation trumps tariffs
Yesterday, the Trump administration announced a 30% tariff on imported solar equipment…and washing machines, for some reason.
The policy rationale appears to be protecting the domestic production of solar PV from the low-cost solar PV produced on mass in China.
While designed to protect one sector of the domestic solar manufacturing industry, it will adversely effect the biggest sector of solar jobs — those in installation, engineering and project management.
A policy ostensibly designed to protect American jobs will likely drive costs up and lead to a net loss of jobs in the solar industry, one of the fastest growing sectors of the US economy.
Despite this, we continue to see innovation progressing clean energy tech and uptake, faster than Trump can keep up.
Today, Rocky Mountain Institute and 35 major leaders of the solar industry announced an “ultra low cost solar product” incorporating modular design, pre-engineering and pre-assembly to reduce the costs of solar architecture.
🌞 🌞 🌞🌞 🌞 🌞🌞 🌞 🌞🌞 🌞 🌞🌞 🌞 🌞🌞 🌞 🌞🌞 🌞 🌞🌞 🌞 🌞🌞 🌞 🌞🌞 🌞
The proposed solar product design will create a:
“…modular, pre-engineered and pre-assembled solar product of standardized design targeting a fully installed cost of ¢50/W and lower costs by as much as $0.20/Wp (dollars in watt peak) in 2018 alone.”
This has the potential to create an 8% reduction in the average national price of residential electricity 🙌 🙌 🙌
Solar modules currently cost between $0.30 and $0.40 / watt. The 30% tariff on solar modules will have a flow on effect of raising the cost of a complete solar installation by about ten cents per watt. It is now the role of the US solar industry to make up the difference with some good old fashioned cunning.
Rocky Mountain Institute’s innovative proposal, in and of itself, could almost offset the additional costs a solar tariff is likely to create.
Another innovation, which can offset the cost of the tariff, is the reduction of red tape associated with solar installations.
“American consumers currently pay twice as much for the installation of a typical residential solar system than the average overseas consumer…Installed solar costs in Australia are $1.34 per watt compared to $3.25 per watt in the U.S.”
Andrew Birch has outlined a simple proposal to reduce costs and offset tariffs — by reducing permitting and code requirements for solar installations.
Birch contends that red tape reductions could cut the cost of solar installation by 47 cents per watt.
Trump seems to be pretty keen on cutting red tape and creating jobs.
This might be a sensible place to start.
Just to recap some relevant solar facts:
- In the last 5 years, solar realized a year-on-year growth rate of 21%
- Investment in solar has topped $100 billion
- Solar now employs more people than coal in the US (above 260,000) — check out my old friends at the SolarFoundation for more information.
New jobs in coal? Not so much…
Solar’s role in energy production is just getting started and only getting bigger. Innovation is playing a crucial role in accelerating the clean energy transition.
Today’s announcement by the Rocky Mountain Institute is just one example of solar innovation rising above politics. Despite political obstacles, solar has an unassailable advantage — it is clean, cheap, abundant and efficient.
The California Clean Energy Fund is backing clean energy entrepreneurs and innovation. Shine on!
