This week President Donald Trump (R) imposed tariffs on imported steel and aluminum, both of which are used in wind and solar power installations. It’s essentially a second set of tariffs this year that will impact the solar industry after Trump imposed tariffs on imported silicon solar panels and cells in January. The renewables industries were concerned with the tariffs and are worried they will drive up the price of renewable energy even as costs come down.
This week Trump imposed global tariffs of 25 percent on imported steel and 10 percent on imported aluminum. However, he excluded Canada and Mexico from the tariffs. In making the widely criticized decision—107 Republican Representatives Congressional wrote a letter urging him to reconsider the sweeping tariffs and his economic advisor, Gary Cohn, resigned—Trump said aggressive foreign trade were an assault on the US.
“Against the backdrop of possible steel and aluminum tariffs, which add costs, particularly to large scale solar projects, we are asking President Trump and Congress to reconsider support for tariffs and adopt pro-American policies that protect American jobs,” contended Abigail Ross Hopper, president and CEO of the Solar Energy Industries Association (SEIA).
Already the solar industry is feeling the impact of the solar tariffs, Hopper noted. “There has been very little interest in building substantial new solar manufacturing capacity as a result of solar tariffs. The actual number of jobs added because of solar tariffs will be negligible under the best of circumstances, while the number of jobs likely to be lost because of these tariffs is 23,000.”
The wind industry, which too will feel the impact of such tariffs, also decried Trump’s actions. “Steel tariffs will decrease competition and trade, ultimately making capital-intensive energy infrastructure projects more expensive by adding cost for US manufacturers along the supply chain,” stated Tom Kiernan, CEO, American Wind Energy Association (AWEA). He contended that the trade policy is counter to theTrump’s purported goal of US energy dominance while harming US manufacturers supporting the wind industry.
The renewable energy industries have previously beseeched Trump to support renewable energy even going as far as sending him a “blueprint,” the America First Plan for Solar Energy. Thus far, however, it appears he hasn’t listened.
Analysts anticipate that the impacts of the tariffs will add 3 percent to 5 percent to the levelized cost of energy from renewable resources. According to GTM Research, MAKE Consulting and Wood Mackenzie, they will lead to slightly lowered project deployment forecasts and will lower project returns.
“The economy-damaging effects of tariffs are both regrettable and avoidable. If the President fails to reverse harmful tariffs, we urge Congress to take action to correct what will be a very bad deal for American workers,” Hopper said.Tweet