HARTFORD, CT — Solar industry representatives in Connecticut are dismayed over a new tariff on solar-energy cells and panels.
Announced last week by President Donald Trump, the tariff is meant to create jobs and revive U.S. manufacturing, but Connecticut officials say it will cost them more jobs than it will create.
“This country gave up supporting the solar industry back in the 70s,” Mike Trahan, executive director of Solar Connecticut, Inc. said. “This is why we are so dependent on parts from other countries.”
U.S. Trade Representative Robert Lighthizer announced the tariffs on imported solar panels and modules, as well as washing machines following an investigation by the U.S. international Trade Commission. The investigation resulted from complaints by domestic manufacturers regarding unfair trade practices.
The tariff on foreign-made solar panels and modules starts at 30 percent in 2018. It drops to 25 percent in 2019; 20 percent in 2020; and 15 percent in its final year, 2021.
Solar Energy Industries Association (SEIA), a trade organization for the industry in the United States, estimated that the country would lose 23,000 green energy jobs this year as a result of the tariffs. The association also stated that billions of dollars marked for investment in solar power would be lost.
The association estimates that there were more than 53,000 homes in Connecticut with solar power and that it accounted for 1.19 percent of the electricity in the state.
Trahan estimates that six out of 10 panels installed in Connecticut come from China. “We are reliant on those modules here,” Trahan said.
He said the tariffs would raise prices and cause layoffs.
According to the SEIA, there are 2,174 jobs in Connecticut related to solar energy and about $1.195 million invested in the industry here.
He referred to the larger number of solar panel installers in the United States, as opposed to solar manufacturers, who will be helped by the tariff.
“The industry here is reliant on what sparks the installment sector,” he said. “There is a nationwide gap between manufacturing and installation.”
There are more than 180 solar power companies in Connecticut, according to the SEIA fact sheet. At least 69 of those are installers and 41 are considered manufacturers, who may benefit from the tariff.
Trahan said the tariffs would have a direct impact on Connecticut and will affect large-scale projects, even though several suppliers have stocked up on the panels in anticipation of the tariff.
Department of Energy and Environmental Protection Commissioner Rob Klee said it’s hard to take the Trump administration seriously when it comes to energy policy.
“While making investments in American manufacturing is important to the overall economy, we should also be investing in the deployment of solar and other renewables at scale, instead of the Trump agenda to bring back coal and other fossil fuels,” Klee said. “Furthermore, these tariffs will cause a significant loss in those installation and design jobs that will greatly outweigh any speculative increase in solar panel manufacturing jobs.”
James Schwartz, the co-owner of Essex-based Independence Solar, said the tariffs would have a negative impact on businesses dealing with green energy companies and dismissed the announcement as “purely politics.” He said steel manufacturers that were building parts like mounts for the panels may also be impacted by this decision.
“Our industry was hit by a growth curve,” he said. “It was predicated on solar costs continuing to go down.”
According to the SEIA fact sheet, solar energy prices in Connecticut have dropped by 55 percent during the last five years.
The U.S. Department of Energy announced on Jan. 24 that it would award a $3 million prize as part of an effort to stimulate new ideas in the solar industry by providing incentives for entrepreneurs. A department spokesperson emphasized that this was in addition to $400 million in funding for solar power projects last year.
“The American Made Solar Prize will galvanize our country’s entrepreneurs, allow them to utilize technologies and innovations through the DOE’s early-stage research and development, and ultimately bring more American-made products to market,” U.S. Secretary of Energy Rick Perry said in a prepared statement.
Trahan expressed doubt that the Department of Energy initiative would compensate for the loss of jobs that he anticipated.
“There’s reason to hope,” he said regarding the potential to grow manufacturing jobs in the industry, adding that manufacturing jobs pay better and are more sustainable. But he added that it was naive to assume that this would compensate for the possible job losses.
He said part of the problem was a lack of shared solar systems, in which property owners co-own an offsite solar power source. He said Connecticut did not embrace the industry as quickly as New York and other states.
Connecticut is ranked 18th in the country in the solar power industry, according to the SEIA fact sheet.
“The emphasis has not been in manufacturing jobs for the green industry,” Trahan said.
Schwartz expressed optimism regarding the long-term picture, however.
“This is a roadblock,” he said. “Solar power will continue to grow. This is not a long-term setback.”