Risk & Compliance

ITC Backs Crackdown on Solar Panel Imports

The commission recommends tariffs as high as 35% on low-cost imports, siding with solar manufacturers against the installation industry.
Matthew HellerNovember 1, 2017

The U.S. has moved a step closer to imposing restrictions on imports of low-cost solar panels in a trade battle that has pitted panel manufacturers against installation companies and users.

The International Trade Commission recommended Tuesday that President Donald Trump impose tariffs of up to 35% on solar cells — the individual mechanisms that convert the sun’s light into electricity — and 30% on solar modules, or sets of cells.

The recommendations followed the ITC’s ruling in September that imports of low-cost solar panels have hurt U.S. manufacturers. In the next two weeks, they will be sent to Trump, who will have 60 days to determine the ultimate course of action.

The case will “be a test of the president’s willingness to impose the kind of powerful trade barriers that he has frequently threatened,” The New York Times said. “Mr. Trump repeatedly talked on the campaign trail about imposing sweeping tariffs on products from China, Mexico and elsewhere.”

Chinese companies are the principal exporters of low-cost panels to the U.S. Two domestic manufacturers, Suniva and SolarWorld, petitioned the trade commission earlier this year, contending they were forced into bankruptcy as a result of a flood of subsidized imports from China.

As Fortune reports, the issue has split the solar industry, with solar manufacturers on one side and, on the other, the solar installation companies, which have “benefited from low-cost panels that have led to explosive growth in rooftop systems on homes and commercial buildings as well as massive solar farms.”

Suniva had requested a 40% tariff. According to the Solar Energy Industries Association, an installation industry group, such a tariff would double the price of solar, destroy two-thirds of demand, erode billions of dollars in investment and cause the loss of 88,000 jobs in 2018.

The four ITC commissioners split on what restrictions to impose. While Rhonda K. Schmidtlein, the commission’s chair, recommended the highest tariffs, David S. Johanson and Irving A. Williamson jointly proposed a 30% tariff on imports of solar cells in excess of 1 gigawatt, as well as a 30% tariff on modules.

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