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President Trump’s Imposed Tariffs May Cloud Vermont’s Solar Scene

  • President Donald Trump, joined by U.S. Trade Representative Robert Lighthizer, speaks to media after signing Section 201 actions in the Oval Office of the White House in Washington, Tuesday, Jan. 23, 2018. Trump says he is imposing new tariffs to "protect American jobs and American workers." Trump acted to impose new tariffs on imported solar-energy components and large washing machines in a bid to help U.S. manufacturers. (AP Photo/Carolyn Kaster)



Valley News Staff Writer
Tuesday, January 23, 2018

White River Junction — President Donald Trump’s decision to move forward with a steep tariff on solar panels could spell particular trouble for Vermont, which has one of the most solar-dependent economies in the nation.

“Vermont’s local solar installers and manufacturers have worked tirelessly for almost two decades to lower costs cost barriers and enable Vermonters the freedom to affordably generate their own energy,” said Olivia Campbell Anderson, executive director of the industry group Renewable Energy Vermont. “The Trump solar tax takes us backward on that progress.”

On Monday, the Trump administration announced that it would follow a recommendation from the U.S. International Trade Commission and impose a 30 percent tariff on imported solar modules and solar cells. The rate will decline before phasing out after four years.

The move is targeted at China, which the trade commission found has cornered more than 70 percent of the world market in solar modules, primarily because the Chinese government has heavily subsidized its solar manufacturing industry.

Between 2012 and 2016, those low-cost solar panels have flooded the U.S. market, which brought solar into financial reach for millions of Americans, but also drove local producers out of business, according to a fact sheet released by the Trump administration in conjunction with the announcement.

“Most U.S. producers ceased domestic production, moved their facilities to other countries, or declared bankruptcy,” according to the fact sheet.

But during that same time period, Vermont’s solar industry has exploded by capitalizing on the need to install lower-cost solar panels from China for residential and commercial customers.

By 2016, 19,000 Vermonters — one in 16 workers — were employed in the clean energy economy, which now includes more than 80 solar companies and has grown at a rate that significantly outpaces the state economy as a whole.

The tariffs were sought last year by Suniva Inc., which filed for bankruptcy protection in April, and the U.S. subsidiary of Germany’s SolarWorld.

The administration also announced a tariff on large washing machines that was sought by Michigan-based Whirlpool Inc.

Suniva spokesman Mark Paustenbach called tariffs “a step forward for this high-tech solar-manufacturing industry we pioneered right here in America.”

However, the Solar Energy Industries Association, which represents installation companies, said billions of dollars of solar investment will be delayed or canceled, leading to the loss of 23,000 jobs this year.

In Vermont, Campbell Anderson said the state solar industry also was facing strong headwinds from a Vermont Public Utility Commission decision to cap net metering, the program that compels utilities to buy excess solar energy from customers.

“Over the last year, the amount of new net metered solar permitted decreased by 50 percent,” Campbell Anderson said. “In 2018, the Trump tax may likely cut local generation further, leading to local job losses.”

Solar companies in the Upper Valley are anxiously awaiting the actual impact of the tariff, and trying to calculate how much it might increase costs for their customers, said Jim Merriam, president of Norwich Solar Technologies, which has a workforce of 35 and installs solar arrays.

“We’ve done some hedging, and have paid in advance ... on projects in the short term to make sure there’s no disruption,” Merriam said. “All the projects in the near term” — like an array on RSD Trucking in Hartford that will provide energy to the town of Woodstock” — “are all good.”

Kevin McCollister is the founder of Randolph-based solar installation company Catamount, where 20 workers do both commercial and residential installations. He said he’s advising customers considering solar to act quickly.

“I wouldn’t wait too long if they’re deciding they should move forward,” McCollister said. “We’re still guaranteeing people 30 days on a proposal quote but there will be a point that prices are going to go up. The writing’s on the wall.”

McCollister said the price bump will only affect one component of a pricing package that includes other materials and labor.

He said a rough estimate suggests their average customer might see a 10 to 15 percent price increase.

Jamie Resor is the CEO of GroSolar, which has offices in White River Junction and Rutland that host about a third of the company’s 75 employees.

Because solar panels make up a larger percentage of the cost of large-scale projects, he said, commercial installations will be hit harder than the residential installation sector.

“We’ve got enough modules for a good part of 2018,” he said. “Some projects may get delayed but our footprint is not going to shrink.”

Resor said focusing on solar manufacturing jobs ignores that most of the economic activity associated with solar energy is not related to building that component.

“Really the jobs are in the engineering designs, the excavators, the civil engineers, the put-the-post-in-the-ground people and all that,” Resor said.

One solar manufacturer that will not be helped by the tariff is Norwich-based Solaflect Energy, President Bill Bender said.

That’s because Solaflect doesn’t manufacture panels — it makes motorized tracking systems that rotate panels with the sun, making them 50 percent more efficient, according to Bender.

And Solaflect’s trackers rely on a supply of panels to rotate, he said.

“Just when the technology gets really interesting, we can’t get it here in the U.S.,” Bender said. “I find that super frustrating.”

He said the Trump administration’s slowing of the solar industry will hurt the country’s ability to compete.

“Even though we’re almost a quarter of the world’s economy we’re only 10 percent of the solar market,” he said. “We’re being left behind, which is really foolish.”

Suniva, SolarWorld and Whirlpool were helped by a 1974 trade law that lets companies seek trade protection if they can show damage from a rise in imports.

Up to certain levels, imports of solar cells will be exempt from the tariff, while the first 1.2 million imported washing machines will get a lower tariff, peaking at 20 percent.

Congress has no authority to change or veto Trump’s decision. Countries affected by the decision can appeal to the World Trade Organization.

Material from the Associated Press was used in this report. Matt Hongoltz-Hetling can be reached at mhonghet@vnews.com or 603-727-3211.