Ah, the sun…lovely. Warm. Powerful. And, more importantly, and almost endless source of “fuel” for the burgeoning renewable energy industry throughout our country. Companies who enter the solar sphere are well set up to make big bucks if they go about it the right way, but up until now, many of them were relying on imported Canadian devices instead of making them on home soil. This week, President Trump took action to drive the business back home, slapping significant tariffs on solar panels coming from Canada. When he did, the Internet blew up in a hail of “Trump is destroying the solar industry,” many of them not understanding what a tariff was or that it actually meant MORE business opportunities in America.
• It may seem backward to effectively cut businesses off from imported goods, especially when it impacts their bottom line. But the hope is that companies operating in solar here in America will eventually begin producing their own equipment, keeping money here, where it belongs.
• The new duties range as high as 30 percent on the most sought-after equipment, significantly slowing down the flow of products into the United States. These products make up an incredible 80 percent of all solar equipment used by American solar providers.
• Some analysts believe the move may have significant disadvantages that may outweigh any perceived benefit. The Solar Energy Industries Association, for example, is forecasting tens of thousands of jobs lost once solar companies can no longer afford to import equipment. The tariffs will also impact employment on Canadian soil.
• Bloomberg New Energy Finance’s Huge Brumley spoke about the move in an interview with Time. “Developers may have to walk away from their projects,” he explained, “Some rooftop solar companies may have to pull out of some states.”
• American solar providers, including First Solar Inc., have an incredible chance to take over the high-cost industry space with more affordable options. Their stocks jumped by nearly nine percent overnight after Trump announced the tariffs. Other American solar providers will (and already are) enjoying similar benefits.
• Despite the sudden shift, Trump did take care to include protections that preserve at least some equipment flow. Companies who import won’t face tariffs on the first 2.5 gigawatts of imported solar cells they bring in. Furthermore, the tariffs start at 30 percent; this number will slowly and gradually drop to 15 percent over four years as homeland companies pick up the slack. Ultimately, this should create a balance that benefits Americans.
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How do you think the solar tariff will impact the industry?