U.S. Tariffs Will Not Do the Solar Industry Any Favors | Sanuber on WordPress.com

As Indian Prime Minister Narendra Modi warns the world against the rise of protectionism at the World Economic Forum at Davos, U.S. President Donald Trump tried to sell the attendees “America First.” On Monday, he also slapped tariffs on foreign-built solar panels and washing machines. This seems to be a part of his push to defend the U.S economy against bad deals, but this will only mean higher prices for these products with no guaranteed effect on U.S. manufacturing and jobs.

The move adds a 30% tariff against foreign-built solar panels and solar cells used to make them, which will then go down to 15% by year four. Some solar industry leaders say these tariffs will hurt sales and lead to cuts in sales and installation jobs. The ultimate effect this tariff will have on overall jobs is unclear, but it is almost sure that that solar panels will become more expensive in the U.S. Even with the first 2.5 gigawatts of cells imported annually being exempt from the tariff, American-made solar panels that depend on foreign-made solar cells will be affected as well.

This will lead to both U.S. and foreign-made solar panels becoming more expensive in the U.S. market. What critics are worried about is that this increase in cost will turn potential consumers, who were noticing solar panels getting cheaper, off as prices go back up.

Finally, countries that will be impacted by these tariffs are going to respond. The Trans-Pacific Partnership trade deal seems to have reached an agreement on Tuesday, without the U.S. This may open the door to larger scale agreements moving away from U.S. cooperation if the TPP proves successful.

Originally published at sanuber.com on January 30, 2018.