Legal & Regulatory

SEIA Makes Anti-Tariff Pitch Tailored to Trump

The Solar Energy Industries Associations (SEIA) on December 5 released an anti-tariff plea specially tailored to President Donald Trump. The “America First Plan for Solar Energy” urges the president to reject tariffs proposed for imported crystalline silicon photovoltaic (CSPV) solar panels.

SEIA’s plea comes as the president mulls over the whether or not to impose tariffs recommended by the U.S. International Trade Commission (ITC) as part of a challenge brought by two solar manufacturers under Section 201 of the Trade Act of 1974. In the challenge, Suniva and SolarWorld, argue that they have been able to compete in the solar industry in the U.S. because of imports.

Those opposed to the tariffs argue that imports have nothing to do with the troubles that Suniva and SolarWorld have had. “German-owned SolarWorld is for sale to the highest bidder and Chinese-owned Suniva is no longer manufacturing. They’ve been stymied by a history of mismanagement and technical failures. No allowable trade relief will save them. These companies initiated the trade case as a last-ditch effort to have the U.S. government save their hides from their creditors,” the SEIA plan says.

The ITC decided on September 22, 2017 that imports had in fact been a significant cause of damage to the Suniva and SolarWorld. On November 13, 2017, the ITC submitted to the president its recommendation for a formal remedy. The recommendation from the ITC is a 30% tariff on imported solar modules declining over four years to 15%. The recommendation also includes a “tariff-rate quota,” which would allow for a certain number of cells to be imported each year tariff-free. The quota starts in year one at 1 GW and increases by 0.2 GW each year.

It is not up to Trump to decide what to do. He can accept the ITC’s recommendation, come up with a solution of his own, or simply decide not to implement a remedy. Trump has until January 12, 2018, to make his decision.

SEIA’s six-point argument for the president to side with them is propped up on a lot of common rhetoric of the current administration. The recommendation is as follows:

  1. “Say no to solar tariffs.” The association argues that the tariffs are simply a bad idea and points out that there is “almost universal opposition,” including from generals, Sean Hannity, and the Heritage Foundation.
  2. “Support our Military and National Security.” The military uses solar power at “mission-critical” facilities, SEIA argues. The association also claims that more than 23,000 veterans are employed in the solar industry.
  3. “Ensure U.S. Energy Dominance.” The plan states that “Ceding world leadership in solar installations will allow other countries, including China, to surpass us in the manufacturing of the technologies we will need in the future. This will exacerbate the problem the Trump administration is trying to address, not solve it.”
  4. “Fight for American Workers and Don’t Turn Off This Economic Engine.” Without tariffs, the solar market is expected to triple in the next five years, according to SEIA. “All of this incredible progress will be stopped in its tracks with tariffs,” the plan says.
  5. “Don’t Bail Out Failed Foreign Firms.” Suniva and SolarWorld are not U.S. companies, the plan argues. “At this point, Suniva and SolarWorld are shell companies for hedge fund investors that made bad bets,” SEIA says. “Why should the U.S. government be bailing these foreign entities out? The companies are trying to exploit U.S. trade law after failing in the market where thousands of solar companies thrive.”
  6. Put in place “An America First Plan for Solar.” Ideally, SEIA argues, that would mean simply rejecting the proposed tariffs.

If the president decides to take the middle ground, rejecting the ITC recommended tariffs, but still choosing to develop some remedy, SEIA believes he should create an import license fee system.

“License revenues collected by the U.S. government are then distributed to the domestic industry to incentivize manufacturing growth. At a fee of a half cent per watt, this would raise roughly $192 million over three years for U.S. manufacturers. A 1¢ per watt fee would raise $384 million,” SEIA’s plan says. “This is money that would be taken from foreign manufacturers and delivered directly to American manufacturers.”

Abby L. Harvey is a POWER reporter.

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