On Thursday, the Commerce Department ruled that China’s solar manufacturers are engaged in “dumping” — that is, they’re selling their panels for below-market rates in order to drive their competitors out of business. In response, the Commerce Department has slapped a 31 percent tariff on imports of silicon photovoltaic cells from China. That’s on top of a separate 3.61 percent charge levied in March. So if these tariffs stick, will that mean the end of cheap solar power in the United States?
Some companies worry that it might. It’s important to remember that there’s a big rift in the U.S. solar industry over trade policy with China. Domestic manufacturers of solar panels — such as SolarWorld — say that they’re being stomped out of business by Chinese competitors who are unfairly subsidized by the government. But companies that install solar panels, represented by the Coalition for Affordable Solar Energy, oppose import tariffs on the grounds that they make solar panels more expensive.
“This decision will increase solar electricity prices in the U.S. precisely at the moment solar power is becoming competitive with fossil fuel-generated electricity,” said Jigar Shah, president of CASE, in a statement.
It’s difficult, however, to forecast the precise effects of the new tariffs. In January, CASE released an analysis by the Brattle Group finding that a 50 percent tariff on Chinese panels could jack up U.S. solar prices by 25 to 30 percent. (About half of all solar systems installed in the U.S. in 2011 used photovoltaic panels made in China, with the panels making up around one-quarter or more of the total cost.)
If a tariff did drive up prices, it would buck a recent trend toward ever-cheaper solar energy. In the past five years, the U.S. retail price of solar power has fallen by half. Rooftop solar installations doubled in 2011. And, according to a new study by Bloomberg Energy Finance, solar power is rapidly reaching the point where it can compete with traditional fossil fuel sources in some instances.
SOURCE U.S. slaps tariffs on Chinese panels. Is this the end of cheap solar? – The Washington Post.