Energy

Gov’t Agency Paves Way For Trump To Slap Tariffs On Chinese Solar Panel Imports

REUTERS/Kevin Lamarque

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Chris White Tech Reporter

The International Trade Commission decided Friday morning that cheap solar panel technologies from China and elsewhere helped bankrupt two solar companies.

An ITC panel found that solar panel producers Suniva and SolarWorld suffered significant injury due to the influx of foreign solar cell and module imports from Asia. The next step will be determining whether a tariff or some other remedy should be used to address the effect cheap solar panel imports have on the industry.

“We brought this action because the U.S. solar manufacturing industry finds itself at the precipice of extinction at the hands of foreign market overcapacity,” Mark Paustenbach, a spokesman for Suniva, told The Daily Caller News Foundation in a press statement.

 “[N]ow it will be in President Trump’s hands to decide whether America will continue to have the capability to manufacture this energy source,” he said, referring to the ITC’s next move, which includes recommending suggestions for Trump on how to reduce international imports.

Suniva was founded in Georgia but sold to Japan-based International Clean Energy in 2015. The company filed a petition for relief from imports with the ITC about a week after seeking Chapter 11 bankruptcy protection. The company received $8.8 million in federal grants from 2010 to 2016, and millions more in incentives from the state government and communities in Michigan.

Suniva and SolarWorld requested initial duties of $0.40 per-watt and an initial minimum price of $0.78 per-module against solar imports from anywhere in the world. Trump’s Office of the U.S. Trade Representative (USTR) called the rule allowing tariffs on international products a “vital tool for industries needing temporary relief from imports to become more competitive.”

Trump, for his part, is generally supportive of heavy tariffs against imports that he believes hurt American businesses.

“For the last six months, this same group of geniuses comes in here all the time and I tell them, ‘Tariffs. I want tariffs.’ And what do they do? They bring me IP. I can’t put a tariff on IP,” the president reportedly told his Chief of Staff, John Kelly, in September. He was referring to his belief that cheap Chinese manufactured goods are ripping off U.S. industry.

Free market groups, however, warn the ITC and other groups to avoid using tariffs against solar panel imports. They argue that history has shown that such tariffs have failed to address the problems they seek to eliminate.

“It’s a classic example of valuing the producer over the consumer,” Clark Packard, a policy analyst at free market group R-Street, told TheDCNF about how tariffs are structured to protect consumers at the expense of consumers.

“Sure, Suniva and SolarWorld, the two petitioners, and their employees may benefit from import restrictions, but other solar companies who use imported solar cells would face higher costs, layoffs, etc. and then consumers of solar products who would see prices spike,” he added.

Former President George W. Bush called for similar tariffs against imported steel, which ultimately caused a spike in steel prices. Analysts found that those higher prices led to a loss of nearly 200,000 U.S. jobs in 2002 alone, and the tariffs themselves led to about $4 billion in lost wages between February and November 2002.

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